A 22-hour long marathon discussion between the currency union leaders and finance ministers of 19 European Union nations, on Monday, materialized into a new bailout package for crisis-struck Greece, pushing it further to implement austerity measures.
The Greece government’s agreement to implement the newly chalked out deal would translate into thorough economic ‘reforms’ under close supervision by its creditors, along with profound and far reaching changes in the realm of energy, labour, and product market. It would also mean a scaling up of privatization, apart from an over hauling of the judiciary and public administration.
Although the ratification of the new bailout package would prevent Greece’s exit from the European Union and the subsequent chaos and crisis, it would also lead to a total surrender of the left-wing government of Alexis Tsipras to the lending countries.
The Parliament, in the coming days, has to pass pension overhauls and sales-tax increases, despite the resounding rejection of the same by the voters, in the recently held referendum in the country. The government’s going ahead with the proposed austerity measures will antagonize the people who voted the leftist party to power, primarily for its promise to reverse austerity. The recent referendum also echoed the same anti-austerity sentiment, with a 61% ‘No’ vote to the bailout programme.
Greece’s rejection of the previous bailout package has brought the economy to a standstill, leading to closure of banks, and all monetary institutions. According to Europe and the IMF’s estimate, Greece needs between 82 billion and 86 billion Euros ($96 billion) over the next three years. They have already lent Greece about 233 billion Euros, since 2010.
Commenting on the new austerity scheme, Donald Tusk, who presided over the negotiations held in Brussels, said, “Euro Summit has unanimously reached agreement”. He also tweeted, “all ready to go for ESM [European Stability Mechanism] programme for Greece with serious reforms & financial support”.