Reuters – Greek lawmakers on Tuesday approved by majority the country’s 2018 budget, which the government said would be the last under bailout terms which have held the country in a stranglehold of austerity for eight years.
“For the first time, we know with certainty that this is the last bailout budget,” he added.
Greece was forced to accept financial handouts from European Union creditors and the International Monetary fund since 2010 when the national debt gotto 104% of GDP. Its third bailout expires in August 2018, by which time it will be expected to finance itself from the markets. The country’s national debt has however increased to 180% of GDP and its economy lost about a third of output over a seven-year period. The landers accept that Greece is gradually returning to growth.
The budget forecasts an expansion in output of 2.5 percent in 2018, compared to a projected 1.6 percent this year. It is expected to generate a primary surplus, which excludes debt servicing, of 3.82 percent of gross domestic output, higher than that set by lenders.
Greece’s fiscal goals have been approved by European Union lenders and the International Monetary Fund.
Under its latest bailout review, the government has agreed to cut spending further, reduce pensions, complete an evaluation of public sector staff skills and qualifications and sell coal-fired power stations. It will tighten the rules for unions to call a strike.
As part of measures to offset the impact of austerity, the finance ministry said on Tuesday that value added tax would not be increased on five islands which have received thousands of asylum seekers since Europe’s migrant crisis erupted in 2015.
A poll by the University of Macedonia for Skai TV aired on Dec. 18 showed New Democracy’s popularity at 30 percent, 12 points ahead of Syriza. Another, conducted by Kapa Research for left-leaning newspaper Ethnos, showed New Democracy leading by 4.8 points.
