Greek Parliament Approves Reforms As Eurozone Ministers Meet
ARUN RATH, HOST:
European finance ministers from the 19-country eurozone are meeting in Brussels to decide Greece's financial fate. And so far, the discussions do not appear to be going too well. We go to NPR's Soraya Sarhaddi Nelson, who's in Brussels, for the latest. Soraya, explain - what is the goal of this meeting?
SORAYA SARHADDI NELSON, BYLINE: Well, the finance ministers are meeting to try and decide whether or not to accept Greek proposals that would jumpstart talks for a new bailout program which they're seeking. And if they do want to accept this, then they have to come up with some preliminary steps to either launch those talks. Or if they don't accept it, then they have to come up with some ways to help Greece, which is on the verge of a banking collapse. And right now, it's difficult to tell which direction they're going. There's a lot of - a lot of people that are for it and a lot that are against it.
RATH: Now, remind us what is in the proposal that Athens sent last Thursday.
NELSON: It's a 13-page plan that calls for hikes in taxes, for example, specifically increasing the value-added tax, which would affect tourism. They also want to cut pensions and raise the retirement age to 67. They want to reduce their debt burden and commit to a budget surplus. And in exchange, they want a three-year bailout program totaling about $60 billion, plus a debt cut or restructuring so that Athens can afford all these loans. Technical experts say, though, that with that restructuring, it's going to be more like $80 billion that would have to go to Greece.
RATH: So what are the sticking points for the eurozone finance ministers?
NELSON: It comes down to one word - trust. I mean, you're talking about these proposals that are now being put forward being even harsher than the ones that Greek voters and their government rejected last week in a referendum. So basically, Athens' critics are saying that, you know, it's - how do we know? I mean, they're saying one thing one minute, one thing the next. Plus, they don't have a really good track record. They've never implemented much of what they promised to do after the last two bailouts. And so the Euro group members are saying that these proposals, even, aren't specific and binding enough. They don't show binding commitments. Here's what Luxembourg's Finance Minister Pierre Gramegna said.
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PIERRE GRAMEGNA: It is important to find out the concrete steps and also how those proposals are going to translate into legislative initiatives. So I think if we have draft bills and if we have the prospect of a vote in the Greek parliament, that will build confidence.
NELSON: Italy and France, though, on the other hand, are more supportive of the plan. They're pushing for the bailout talks to go ahead.
RATH: Now, Germany, though, is one of the countries that has to say yes to a deal, and the chancellor and finance minister of Germany have been pretty negative. Have they softened at all?
NELSON: Not really. And, in fact, there was a disturbing report - for the Greeks anyway - in the Frankfurter Allgemeine newspaper today that claimed that the German Finance Ministry has an exit plan or exit strategy for Greece. That plan would see $55 billion in Greek assets being sold off to pay creditors. Greece would basically get the boot for five years out of the eurozone, at which time it would restructure its debt. But then it would stay in the EU and would receive some humanitarian aid and other measures to help it boost growth. But there's some sense that that plan, even though that's something that the finance minister put out, is not necessarily the one that's going to be adopted.
RATH: So what happens tomorrow if the finance ministers are able to come to an agreement?
NELSON: Well, whether they do or don't, the eurozone leaders will need to try and make some kind of decisions, whether it's to pave a way to reopen talks or to nix the bailout and deal with the fallout of a Greek banking collapse. And then, after that, the full EU leadership will meet, and there's little doubt that one topic they will talk about is the political fallout from this crisis.
RATH: NPR's Soraya Sarhaddi Nelson in Brussels. Soraya, thank you.
NELSON: You're welcome. Transcript provided by NPR, Copyright NPR.