Greek PM: Much Work Before New Bailout

Posted February 22nd, 2012 at 2:55 am (UTC-5)
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Greek Prime Minister Lucas Papademos says the country has a lot of work to do before getting the new $172-billion bailout from the European Union and International Monetary Fund.

The Greek parliament has agreed in principle to the package of spending and job cuts as demanded by the EU and IMF. The lawmakers must now pass all 79 specific measures included in the package before getting the bailout funds.

The bailout will likely avoid the bankruptcy Greece faces if it cannot pay investors $19 billion when government bonds come due, March 20th.

The rescue package requires Greece to make deep and unpopular spending cuts. They include a 22 percent cut in the country’s minimum wage and the elimination of 15,000 government jobs.

Thousands of Greeks have held sometimes violent street protests against the cuts, saying they have already sacrificed enough.

But eurozone chief Jean-Claude Juncker says the bailout will preserve the financial stability of both Greece and the eurozone.

The head of the EU delegation to the United States, Ambassador Joao Vale de Almeida, told VOA in an exclusive interview that the bloc has learned a lot from the crisis, namely the need for a mechanism to deal with emergency situations, an improved level of economic governance and solidarity among all members of the euro community.

“I think we learned a lot. We learned a lot about the means that we need to have to deal with emergency situations. We didn’t have them before. We created, we developed them to deal with the cases like Greece and a few other countries. Secondly, we learned that our governance system was not yet at the right level of sophistication, and we are in fact changing a lot; if not, there is a small revolution going on inside the euro area in the way we deal with what we call the economic governance. There is a lot being changed. And thirdly, I think we learned a very simple lesson. When you are part of a system, there has to be solidarity.”

The White House says President Barack Obama called German Chancellor Angela Merkel to welcome the “positive steps” European leaders took to help defuse the Greek debt crisis.

Greece got a $145 billion bailout last year and is, by far, the biggest recipient of international aid in the history of the 17-nation eurozone. Yet Greece accounts for just two percent of the eurozone economy.