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ATHENS — Greece’s Parliament has passed the 2015 budget, which projects a narrowing deficit and an economic growth rate of 2.9 percent.

The budget passed early Dec. 8 on a vote of 155 to 134, with one deputy voting “present.” The approval, coming at the end of a five-day debate, was expected.

The budget projects that Greece’s primary surplus, which excludes interest payments on outstanding debt, will be 3.3 billion euros ($4.05 billion) or 3 percent of GDP, but Greece’s creditors anticipate a lower surplus. The budget sees the deficit narrowing to 338 million euros ($415 million), or 0.2 percent of GDP, next year, down from 1.3 percent this year.

“After many decades, our country has got a balanced budget. This is a historical moment,” Prime Minister Antonis Samaras told reporters.

The government now has to convince the so-called Troika of Greece’s creditors — the European Commission, the European Central Bank and the International Monetary Fund — that its budget projections are valid and that no additional austerity measures will be needed to achieve the budget targets.

When the draft budget was unveiled in November, Troika representatives were demanding an additional 3.5 billion euros ($4.3 billion) in cutbacks or extra taxes. Samaras told Parliament on Dec. 7 that the difference in estimates is 1.7 billion euros ($2.1 billion).

Talks with the troika have been fraught lately, with Samaras speaking of the creditors’ “unreasonable” demands.

Nevertheless, finance minister Gikas Hardouvelis has sent proposals to the Troika that would involve cutbacks in pensions and a rise in hotel tax, among other measures, if the two sides fail to agree. The government is also pleading with the troika to wait and see how the budget is being executed before pressing for more cutbacks.

Samaras mentioned in his closing speech that Greece outperformed its budget targets in 2012-14 in the face of creditor skepticism.

The bigger hurdle for the government is finding the 180 votes required by the constitution to elect the next Greek President sometime in January or February. Falling short would lead the country to new elections, and polls show the Radical Left Coalition (SYRIZA) party the likely winner.

Opposition leader Alexis Tsipras, head of SYRIZA, said the government was ready to say yes to any creditor demands for more austerity, and more misery for the people.

Hardouvelis said Greece does not produce enough, and that it is time to move away from excessive consumption financed by heavy borrowing. He said SYRIZA is an advocate of this model.

 

The post Greek Parliament OK’s Balanced Budget, More Pension Cuts For Troika appeared first on The National Herald.

Source: The National Herald
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