Crucial week for the future of the euro

The coming days seem crucial for the future of the euro for many, even in the European Union, as pressures on the Spanish economy are rising and scenarios about further support of Greece from its partners are giving and taking, along with the conflicting views of European policies on how to manage the debt crisis in the EU.

The meetings of EU president Herman van Rompuy with European leaders are particularly important, as he will try to find a common line before the ECB meeting and the decision of the German Constitutional Court about the Permanent Support Mechanism (ESM).

Specifically, on Tuesday September 4, van Rompuy will meet with Angela Merkel, and the next day with François Hollande in Paris.

Diplomatic sources cited by the French news agency report that Greece will be found high on the agenda of van Rompuy’s diplomatic contacts, who has made an informal request for a two-year extension of the loan program.

The issue of Spain will also be discussed, about which the EU has announced that it can release up to 100 billion euros to recapitalize commercial banks, while there is still an open issue regarding its appeal for a complete bailout package, and not just for the banking system.

On Friday, September 7, van Rompuy will come to Athens to meet with prime minister Antonis Samaras. On Saturday, he will visit Cernobbio on the shores of Lake Como in northern Italy, where he will meet with Italian prime minister Mario Monti.

Greece: The package of austerity measures 11,5 billion

At 12 pm today the cabinet will sit at the negotiating table for the adoption of the new measures. The staffs have formulated their own red lines and require equivalent measures against the proposed package of 11.5 billion euros. 

After the briefing they had from the government on Wednesday evening, members of financial staffs from PASOK and the Democratic Left were in continuous consultations on Thursday. 

In PASOK Protopapas, Koutroumanis and Sachinidis met with party president Venizelos on Thursday morning, but also held a meeting amongst themselves. In the Democratic Left, Chatzisokratis discussed the proposals with president Kouvelis and later convened the central secretariat of the party. During these meetings they discussed the proposed measures of the economic team that include: 

- elimination of the 13th and 14th pensions for all pensioners without exception

- elimination of the 13th and 14th salaries for civil servants

- decrease of pensions

- elimination of seasonal unemployment benefits

- reduction of benefits for people with disabilities

- implementation of age-related criteria in EKAS

- elimination of automatic wage increases in the security forces

- reduction of tax exemptions

 

Officials also discussed the increase of the pensionable age by one or two years, which is a “red line” for many MPs of the three governmental parties. 

PASOK and the Democratic Left also seem to require equivalent measures to total cuts in the bonuses of pensioners. Their members say "no" to cuts in OGA pensions. A former PASOK government member wondered who will vote for a reduction in disability benefits. 

On the ND side, disagreements lie in different issues. According to information, they rejected the Democratic Left’s proposal for the State not to pay the total of clergy salaries, but left an open window for the possibility of cuts in the salaries of bishops.