Prime Minister George Papandreou pledged late on Monday to introduce belt-tightening measures demanded by Greece’s international creditors as the head of the European Commission warned the debt-ridden country that passage of a contentious package of austerity measures is a ?necessary condition? for more aid.
Papandreou?s government faces a vote of confidence in Parliament late on Tuesday. If, as expected, it survives, it will have to pass its medium-term fiscal plan through the House a week later. Barroso added to the calls from Europe for the widest possible support for the new package of austerity measures in Greece.
After a meeting in Brussels with European Commission President Jose Manuel Barroso late on Monday, Papandreou acknowledged that Greece is engaged in ?very difficult and complicated? negotiations with European governments over the next bailout payment, but said he was seeking the ?widest possible consensus? in Parliament for the austerity measures called for by Greece’s lenders to prevent bankruptcy.
A vote on the austerity package has been fixed for the end of this month, but Papandreou’s Socialists must first survive a vote of confidence in Parliament on Tuesday.
Barroso, who described the June 28 vote as ?crucial,? said the approval of the budget measures was a condition for releasing the next tranche of financial support to Athens.
?I therefore trust that Greece’s elected representatives will back these measures next week in a spirit of national and indeed European responsibility,? Barosso said in a written statement.
?Now is not the time to falter. Now is the time to redouble efforts: for the sake of the Greek people, and for all of Europe,? Barroso said.
The Greek prime minister has made several unsuccessful attempts to secure the backing of opposition parties. Talks between the two mainstream parties, PASOK and the New Democracy conservatives, over hammering out a union coalition broke down last week amid a welter of mutual accusations.
In the wake of the collapse, Papandreou held a Cabinet reshuffle to ensure that the austerity measures pass.