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Greek Leaders Accept Austerity Measures But Fight Far from Over

Greece’s coalition government, formed five months ago, never expected a honeymoon period. After a fractious vote on a new round of austerity measures in Parliament on Wednesday, it knows it is involved in a grim battle for survival. The three-party administration narrowly won the ballot, collecting just 153 of the 300 votes despite having 177 MPs ahead of the vote.

The result means that the structural reforms and spending cuts the European Union and International Monetary Fund asked to be implemented over the next two years have passed into law. This should persuade Greece’s lenders to release more bailout funding, but that will not be the end of this government’s troubles.

Prime Minster Antonis Samaras has one more immediate hurdle to clear on Sunday, when lawmakers vote on the 2013 budget. The ballot will take place just a few hours before euro zone finance ministers meet on Monday. The government had been hoping the Eurogroup would agree to release the €31.5 billion ($40.2 billion) in loans Greece has been expecting for several months. But it seems this decision will be put off until the country’s lenders decide how to tackle its financing gap and make its debt sustainable.

Source: Businessweek. Read full article. (link)

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