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MEPs question Greece's on-going austerity plan

brussels bureau

MEPs question Greece's on-going austerity plan


The latest plan to get Greece get out of the economic mire it finds itself in has a familiar ring to it – more and quicker austerity in exchange for the next vital injection of cash. Many MEPs and economists in Brussels, especially from the left, question the strategy of continual cuts in return for bailouts.

‘‘Greece’s debt must be restructured. Everyone agrees Greece cannot pay and a part of its debt must be written off. The European Financial Stability Fund’s powers must be extended to recapitalise banks that are going to suffer loses. That’s what the Council should have done last weekend, but they didn’t, which was irresponsible,’‘ said Social Democrat MEP Liem Hoang Ngoc.

The big problem for the Greek economy – like much of the euro zone – remains Growth. Many argue what it really needs is a huge stimulus plan, not more cuts.

Eckhard Hein from Berlin School of Economics and Law: ‘‘What Greece in fact needs is a kind of European Marshall plan. It can be direct investments via the European Investment Bank, it can structural and regional funds, it can of course also be credit by the European Central Bank.’‘

Up to now Greece’s international lenders show no signs of changing course. Athens must deliver on its tough promises regardless of what the social and economic consequences for ordinary Greeks might be.

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