Greece, which has been forced to implement a painful austerity programme by its creditors, is finding one of their prescriptions very hard to swallow – the pension reform. Pension reform, a euphemism for pension cuts, has been a thorny issue between Greece and its international creditors, with the former finding this demand unreasonable and the latter considering it an essential part of the austerity measures. The pension cuts could create social tension and even rebellion in a country which has suffered more than enough during the financial crisis. A vulnerable segment of population will be pushed into penury, with no help forthcoming from any quarters.
Greece’s Prime Minister Alexis Tsipras said that his country was ready to respect all terms of its agreement with the creditors, but not the demands he considers “unreasonable and undeserved”. The statement comes just days after Athens got one billion euros under the terms of its third bailout programme and it comes ahead of crucial talks on the crucial pension reforms. The creditors -- the European Commission, the European Central Bank, the International Monetary Fund and the ESM – had agreed to a third Greek debt rescue programme in August worth $94bn after Greece looked to be on the brink of crashing out of the eurozone.
As Greeks enter a new year, a majority are not optimistic about the future after six years of economic turmoil which has crippled their lives. According to a poll conducted for a local newspaper, 55 percent of respondents said they believed things would get worse this year while 61.1 percent said a Grexit scenario would resurface. But an exit from the EU is highly unlikely because the country has bid goodbye to the worst of economic crisis and the forthcoming negotiations on pension reform are unlikely to lead to an explosive situation. But the poll reflects the deep pessimism of Greeks about the state of affairs in their country. It could also stem from the hard realisation that their government will finally succumb to the demands of its creditors despite the initial protests. This had happened several times in the past, and is likely to be repeated. The signs are already there. For example, the government is already working on overhauling the pension system. The labour ministry is working on a new social security system under which state-guaranteed pensions will be reportedly cut by half to a minimum of 384 euros and the rest will depend on a person’s income and years of social security payments.
The government must work hard to rebuild the economy and Greeks have no option but to support their government.
Greece, which has been forced to implement a painful austerity programme by its creditors, is finding one of their prescriptions very hard to swallow – the pension reform. Pension reform, a euphemism for pension cuts, has been a thorny issue between Greece and its international creditors, with the former finding this demand unreasonable and the latter considering it an essential part of the austerity measures. The pension cuts could create social tension and even rebellion in a country which has suffered more than enough during the financial crisis. A vulnerable segment of population will be pushed into penury, with no help forthcoming from any quarters.
Greece’s Prime Minister Alexis Tsipras said that his country was ready to respect all terms of its agreement with the creditors, but not the demands he considers “unreasonable and undeserved”. The statement comes just days after Athens got one billion euros under the terms of its third bailout programme and it comes ahead of crucial talks on the crucial pension reforms. The creditors -- the European Commission, the European Central Bank, the International Monetary Fund and the ESM – had agreed to a third Greek debt rescue programme in August worth $94bn after Greece looked to be on the brink of crashing out of the eurozone.
As Greeks enter a new year, a majority are not optimistic about the future after six years of economic turmoil which has crippled their lives. According to a poll conducted for a local newspaper, 55 percent of respondents said they believed things would get worse this year while 61.1 percent said a Grexit scenario would resurface. But an exit from the EU is highly unlikely because the country has bid goodbye to the worst of economic crisis and the forthcoming negotiations on pension reform are unlikely to lead to an explosive situation. But the poll reflects the deep pessimism of Greeks about the state of affairs in their country. It could also stem from the hard realisation that their government will finally succumb to the demands of its creditors despite the initial protests. This had happened several times in the past, and is likely to be repeated. The signs are already there. For example, the government is already working on overhauling the pension system. The labour ministry is working on a new social security system under which state-guaranteed pensions will be reportedly cut by half to a minimum of 384 euros and the rest will depend on a person’s income and years of social security payments.
The government must work hard to rebuild the economy and Greeks have no option but to support their government.
