Greek PM Appeals to Parliament to Support Unpopular Austerity Measures

Posted June 19th, 2011 at 2:35 pm (UTC-5)
Leave a comment

Greek Prime Minister George Papandreou has appealed to parliament to support deeply unpopular austerity measures demanded by international lenders, as Greece seeks emergency loans to avoid defaulting on its debt.

Mr. Papandreou told lawmakers Sunday Greece is at a “critical” junction, facing bankruptcy next month unless it secures the next installment of a bailout offered last year by the European Union and International Monetary Fund.

Both organizations have conditioned their financial support on Greece's Socialist government approving a package of new spending cuts, tax hikes and state asset sales that have outraged many Greeks and triggered weeks of protests.

Mr. Papandreou was speaking at the start of a parliamentary debate on confidence in his Cabinet, which he reshuffled on Friday in response to internal party criticism of his handling of the crisis. Lawmakers are expected to vote on the confidence motion Tuesday. Socialists hold a slim five-seat majority in the 300-member assembly.

If his government survives the vote, Mr. Papandreou is expected to seek parliamentary approval for the austerity measures by the end of this month. In his address Sunday, he also proposed a referendum on constitutional reforms aimed at making the government less inefficient and more capable of functioning independently of foreign aid.

The leader of Greece's Conservative opposition, Antonis Samaras, reiterated his rejection of Mr. Papandreou's austerity proposals Sunday and called for early elections.

Mr. Papandreou's newly-appointed Finance Minister Evangelos Venizelos met with other finance chiefs of the 17-member euro zone Sunday in Luxembourg to ask them to release the $17 billion installment from the $160 billion bailout approved last year. The IMF has said it is ready to release its share of the funds if Greece meets its austerity promises.

Venizelos said the meeting is an opportunity for him to reiterate what he called the “strong commitment of the Greek government and the strong will of the Greek people” to implement the austerity program.

Athens also is negotiating a second bailout package to keep its economy afloat beyond September. But EU leaders have been unable to agree on the terms of such a loan, including how much of its should be funded by the private sector.