Eurozone bailout will not end Greece's pain
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E-mail Xinhua, February 20, 2012
Eurozone finance ministers will convene in Brussels Monday after weeks of brinkmanship to decide whether to offer Greece its next round of rescue funding to avoid a chaotic default.
The Eurogroup conference, originally scheduled for last Wednesday, was delayed by head of the currency bloc Jean-Claude Juncker because the Greek government had not fulfilled all the bloc's demands.
Juncker, who is also Luxembourg's prime minister, said Tuesday he had not received any pledges from the Greek coalition government about the implementation of its austerity program.
The peripheral eurozone country is expected to face a national default if it cannot make a 14.5-billion-euro (19 billion U.S. dollar) bond repayment due on March 20.
According to analysts, Greece will continue to struggle with its economic woes even with the new 130-billion-euro (170 billion dollar) bailout. They say the funds may still not be enough to bring the country's debt down to a manageable level in the long term.
NATIONAL PROTESTS CONTINUE
Meanwhile, thousands of disgruntled Greeks staged rallies in Athens once again on Sunday, waving banners and protesting the painful austerity measures which were passed by the Greek cabinet a week ago.
Under the protection of riot police, the coalition government approved the austerity program in a 199-74 vote on the evening of Feb. 12 and tens of thousands took to the capital's streets, throwing stones and setting fire to several buildings.
The violent protests reportedly spread to other areas, such as the northeastern city of Thessaloniki.
However, according to a series of recent opinion polls published in local newspapers, a majority of the Greek people strongly support the country's membership in the eurozone, acknowledging that Greece would certainly face a devastating bankruptcy if it quit.
What's more, more than 90 percent of Greeks expressed deep opposition to the interim government, criticizing the two-year austerity and reform drive underway as the wrong way to tackle the debt crisis.
Greece's jobless rate in November rose to a record 20.9 percent, the country's statistics service ELSTAT said earlier this month.
As analysts said, the soaring unemployment has buried a ticking bomb, which is destabilizing the country's social security.
ECONOMIC GLOOM
The Greek coalition government, which groups the two main political parties, pledged to cut the minimum wage 22 percent and to dump 15,000 jobs in the country's public sectors by the end of this year.
It also promised to further trim its 325-billion-euro (425 billion-dollar) national budget during its 2012 debt-restructuring plan.
However, this won't help the country's flatlining economy, which, according to official figures released last week, dropped at a 7-percent annual rate in non-seasonally adjusted terms in the fourth quarter of 2011.
If previous forecasts of a 6 percent contraction for all of 2011 prove true, it will be the fourth consecutive year of economic decline in Greece.
In October, the Greek government was asked to reduce its debt from the current 160 percent of annual economic output to about 120 percent by 2020.
However, according to international observers, the government has failed to tackle the economy's slide since it was hit by the sovereign debt crisis.
What's more, they said, harsh austerity measures demanded by Greece's so-called troika of foreign lenders -- the International Monetary Fund, the European Commission and the European Central Bank -- would to some extent further hammer the country's economy.
DIVIDED COALITION GOVERNMENT
The Greek coalition government remains widely divided, although leaders of the two main parties, the socialist Pasok party and the conservative New Democracy party, urged their deputies to back the austerity bill.
The two coalition parties expelled more than 40 lawmakers for not supporting the bill, proving the claims made by socialist George Papandreou and conservative Antonis Samaras that dissenters were not welcome in the parties.
George Karatzaferis, leader of the right-wing Popular Orthodox party, said he did not back the tough terms attached to the bailout.
Later, all four cabinet members from the party resigned and two other members, both socialist deputy ministers, also quit the government.
Prime Minister Lucas Papademos might reshuffle the cabinet in the coming days, analysts said, citing the possibility the dismissed legislators might form a new political party.
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