Reuters — Greece’s government trumpeted a debt relief deal with other euro zone countries on Wednesday as the beginning of the end of its bruising six-year financial crisis but Greeks remained sceptical and markets were cautious.
After years of austerity demanded by Greece’s international creditors – the latest passed by parliament on Sunday – Greeks wonder whether the sacrifices they made to stay in the euro zone were worth the pain.
“We are done, we can’t even leave our homes anymore to have a coffee,” said Panagiotis Zabetakis, 50, a carpenter who, like one in every four Greeks, is unemployed.
But prices everywhere will rise on June 1 when the measures passed to secure Wednesday’s deal start coming into force.
By next year Greeks will pay an extra 20-30 cents for their coffee and the price of just about everything else will rise too as VAT goes up to 24 percent from 23 percent. Greeks’ spending power, meanwhile, is in sharp decline.
“We are running after the Europeans, hoping they throw us a bone which would suffice for a few months. I’m very disappointed,” Zabetakis said, criticizing the deal which opens the way for debt relief from 2018, but does not include any firm promise to reduce the payments Greece has to make.
Greece has been hit with waves of pension cuts and tax increases since it was forced to seek its first bailout in 2010.
Leaving the meeting in Brussels where he secured 10.3 billion euros ($11.5 billion) in new funds, Finance Minister Euclid Tsakalotos said he hoped the deal marked “the beginning of turning Greece’s vicious circle of recession-measures-recession into one where investors have a clear runway to invest in Greece.”
Analysts said that to regain investor confidence Greece still needs to show it can implement the promised reforms, even though much of the hard work – pushing the measures through a fractious parliament – has already been done.
The deal won a provisional commitment from the IMF to return to the bailout process, despite its doubts that Greece will miss its targets.
But with Germany opposed to cutting the debt pile, euro zone ministers made any relief measures such as extending maturities on loans contingent on Athens respecting strict criteria, something Greeks fear means more austerity.
On the streets of Athens, a 33-year-old chartered accountant, who declined to give his name fearing repercussions at work, said he was tired of scraping by.
“I feel we are just living in this vortex of austerity measures,” he said. “It’s a constant of just sacrifices.”
