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Greek parliament to vote on new cuts-for-cash plan to break deadlock Markets rally amid hopes for Greece deal
(about 4 hours later)
Greek prime minister Alexis Tsipras will on Friday seek the backing of MPs for a harsh new round of austerity measures totalling €13bn in an attempt to break the deadlock over its bailout. Stock markets have raced ahead across Europe amid renewed hopes that a deal can be reached to save Greece from crashing out of the eurozone.
A 13-page document sent to Greece’s creditors on Thursday night outlines plans to cut fiercely protected privileges such as pensions, tax breaks for the country’s islands and military spending. In exchange, Greece wants a three-year €53.5bn loan deal to save the nation from bankruptcy and kickstart its wrecked economy. The Greek prime minister, Alexis Tsipras, has submitted proposals for a harsh new round of austerity measures totalling €13bn (£9.35bn) in an attempt to break the deadlock over its bailout and is now seeking the backing of parliament in Athens.
Related: Greek crisis: Government submits reform plan in bid for new aid deal - as it happened In the 13-page document sent to Greece’s creditors on Thursday night, he outlined plans for fierce cuts on protected privileges such as pensions, tax breaks for the country’s islands, and limits on military spending. In exchange, Greece wants a three-year €53.5bn loan deal to save the nation from bankruptcy and kickstart its wrecked economy.
But it faces a rough ride from MPs opposed to giving any ground to the paymasters in Brussels and the IMF in the wake of more than 60% of Greeks rejecting more austerity in the 5 July referendum. The French CAC leapt by 2.4%, the German DAX gained 1.6%, and in London the FTSE 100 rose 70 points, or 1%, as traders welcomed signs of a breakthrough.
In a sign of possible trouble ahead, energy minister Panagiotis Lafazanis, who leads the most radical wing of the ruling Syriza party, did not sign the package. There was some caution, however, over the scale of the capitulation. Chris Weston of IG, said: “The Greek public voted against austerity last Sunday, yet what we have seen is a giant step closer towards the creditors’ prior proposal which was subsequently rejected, ironically by Tsipras.
Another key figure on the left, Zoe Konstantopoulou, the president of the parliament, has publicly announced that no new memorandum outlining further austerity will be passed by the 300-seat House. Related: Greek crisis: Markets surge after Athens submits reform plan - live
However, she met prime minister Alexis Tsipras on Thursday night and left his office without making any comment. “There will be factions within the Greek parliament that simply won’t know what Tsipras is playing at, so when the Greek parliament vote on these measures today it is by no means a done deal.”
Government insiders are saying the proposals were sent at 10pm Greek time (8pm British time) to all three creditors and the president of the euro group of finance ministers, Jeroen Dijsselbloem. Tsipras faces a rough ride from MPs opposed to giving any ground to the paymasters in Brussels and the IMF in the wake of more than 60% of Greeks rejecting more austerity in the 5 July referendum.
The Dutch finance minister must sign off on the reforms before they are submitted for further discussion to EU leaders. In a sign of possible trouble ahead, the energy minister, Panagiotis Lafazanis, who leads the most radical wing of the ruling Syriza party, did not sign the package.
The proposed package was tabled in parliament as an emergency bill on Thursday. It will, say officials, be put to vote on Friday evening in order to invest the Greek prime minister, Alexis Tsipras, his deputy Yannis Dragasakis and finance minister Euclid Tsakalotos with the appropriate authority to conduct talks around the proposed reforms. Another key figure on the left, Zoe Konstantopoulou, the president of parliament, has publicly announced that no new memorandum outlining further austerity will be passed by the 300-seat House. However, she met prime minister Alexis Tsipras on Thursday night and left his office without making any comment.
Government insiders are saying the proposals were sent at 10pm Greek time (8pm BST) to all three creditors and the president of the Eurogroup of finance ministers, Jeroen Dijsselbloem. The Dutch finance minister must sign off on the reforms before they are submitted for further discussion to EU leaders.
The proposed package was tabled in parliament as an emergency bill on Thursday. It will, say officials, be put to vote on Friday evening in order to invest Tsipras, his deputy Yannis Dragasakis and finance minister Euclid Tsakalotos with the appropriate authority to conduct talks around the proposed reforms.
Until a cast-iron agreement is reached, the vote will not be binding – rather it is aimed exclusively at furnishing the central protagonists in Greece’s negotiating team with the authority to debate with creditors around the proposed reforms. Once negotiations are completed it will become law.Until a cast-iron agreement is reached, the vote will not be binding – rather it is aimed exclusively at furnishing the central protagonists in Greece’s negotiating team with the authority to debate with creditors around the proposed reforms. Once negotiations are completed it will become law.
Syriza MPs may also gather to vote on the measures. A senior member of the party’s parliamentary group said he was “asked to be on standby” to vote on the package on Friday. Syriza MPs may also gather to vote on the measures. A senior member of the party’s parliamentary group said he was asked to be on standby to vote on the package on Friday. “We have all been told to be here. We may have to vote on it tomorrow,” he said.
“We have all been told to be here. We may have to vote on it tomorrow,” he said.
The measures drawn up by prime minister Alexis Tsipras and his cabinet on Thursday include:The measures drawn up by prime minister Alexis Tsipras and his cabinet on Thursday include: