NEWS

Mood upbeat as troika returns

At the end of another tense week for Greece, the mood within the government appeared to be one of cautious optimism and relief on Thursday as foreign officials returned to resume their audit of Greek finances and Germany?s parliament approved a European bailout fund.

Addressing a cabinet meeting, Prime Minister George Papandreou thanked party cadres for taking the ?difficult but necessary? decision of backing a controversial new property tax in a parliamentary vote on Tuesday – a move widely believed to have convinced foreign auditors of the government?s resolve – and stressed that his administration?s priority remained the implementation of a second Greek bailout, hammered out as part of a broader eurozone rescue fund in July by European leaders.

?It goes without saying how crucial this agreement is for our country,? said Papandreou, who is due in Paris today to meet with French President Nicolas Sarkozy and European Council President Herman Van Rompuy. ?These are decisions taken after months of negotiation, based on the sacrifices of the Greek people,? he said.

Germany?s parliament on Thursday became the latest eurozone member state to ratify the fund, whose implementation would be a major step toward tackling the bloc?s broadening debt crisis.

In a related development, Germany?s Finance Minister Wolfgang Schaeuble said that a decision on whether to release the sixth tranche of bailout loans to Greece, valued at 8 billion euros, would be taken on October 13. In an interview with German weekly Die Zeit, Schaeuble said Greece should be given more time to sort out its fiscal shortcomings.

Papandreou told Thursday?s cabinet meeting, which focused on a new tax system being finalized and on a scheme to slash the public sector, that the new reforms were bound to provoke more political and social upheaval. ?No one should take advantage of the pain of the Greek people which we are only too mindful of,? said the premier.

There were some tense moments during the meeting, notably when Justice Minister Miltiadis Papaioannou accused Finance Minister Evangelos Venizelos of ?shilly-shallying? over a new policy obliging taxpayers to submit half their annual income?s worth of receipts with their tax returns.