No bailout money without cuts, EU tells Greece

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No bailout money without cuts, EU tells Greece

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Euro zone finance ministers met in Luxembourg on Monday in a bid to stop the Greek debt crisis from threatening the future of the single currency.

Investors fear that the 17 euro-using nations married together over the past decade could be heading for a messy divorce.

American economist Nouriel Roubini wrote in the Financial Times last week that a euro zone split was “imminent” because the EU had failed to address the issues of competitiveness and economic convergence.

Greece is 340 billion euros in the red. Its shrinking economy, which relies heavily on tourism, means it is unable to pay those debts without international aid.

Its lenders of last resort, the EU and the IMF, insist 78 billion euros in public spending cuts must get through parliament before more bailout money is paid out.

Olli Rehn, EU Economics Commissioner, said “The essential condition is that the Greek parliament will have to endorse the medium term fiscal strategy and the privatisation programme before the end of June. Once this is done, then the (next payment of aid) will be made in time (before mid-July).”

Some 50 billion euros of state assets are also on the block.

euronews’ correspondent in Athens said the EU has sent a warning to Greece that it won’t keep on writing blank cheques to prop up its economy.

The question now is whether the Greek parliament can meet the challenge by passing new austerity measures amid popular outrage.