With the troika’s technical teams due to resume inspections in Athens on Tuesday, and mission chiefs due back within a week, government officials have been in back-to-back meetings in a bid to finalize Greece’s stance opposite its foreign creditors amid pressure for more budget cuts.
Prime Minister Antonis Samaras is expected to pursue a hard line in talks with envoys of Greece’s creditors – the European Commission, European Central Bank and International Monetary Fund – when they arrive, most likely on November 4. Ahead of that, ministry officials will seek to promote the progress achieved by the government in implementing some of the “prior actions” demanded by the troika in exchange for the next tranche of rescue funding, a sum of 1 billion euros.
Talks are expected to stick on the size of the fiscal gap for next year, which Greece puts at around 500 million euros and the troika puts closer to 2 billion euros.
Reliable sources told Kathimerini’s Brussels correspondent Nikos Chrysoloras that Greece’s lenders do not consider Greece’s plans so far to produce a smaller fiscal gap credible.
Finance Minister Yannis Stournaras has insisted in statements over the past few days that the 500 million euros would be found, most likely from Greece’s social security funds. Labor Minister Yiannis Vroutsis has indicated that the revenue will be raised from a crackdown on employers evading their social security contributions.
Other points of contention in the negotiations are expected to include layoffs in the civil service. Some reports suggested that creditors expect 11,500 public sector workers to be dismissed by January out of the total of 15,000 that are supposed to go by the end of next year but Brussels sources said that this information is inaccurate and that the target remains 4,000 sackings by the end of this year and another 11,000 by the end of next year.
The fate of three state firms – EAS, ELVO and Larco – also hangs in the balance as the troika is reportedly insisting that they be liquidated rather than restructured.
It remains unclear how far the government will go to defend state firms and workers. But both Samaras and Stournaras have repeatedly insisted that the government will impose no more “horizontal cuts,” indicating further reductions to salaries and pensions.
Speaking at Monday’s annual parade in Thessaloniki, marking Greece’s resistance to the Nazis in World War II, President Karolos Papoulias underlined the inability of Greeks to take any more austerity. “The Greek people can give no more,” Papoulias said, adding that Greece’s creditors “should not think that we will succumb to blackmail.”