Greek Debt Crisis: Parliament backs Tsipras’ reform program

Lawmakers in the Greek parliament overwhelmingly backed a package of economic reforms and further austerity measures, in the hope that it would convince European creditors to back a third bailout of the country.

Greek politicians on Saturday approved a government motion to seek authorization for reform proposals that would play a role in a third bailout in talks with creditors this weekend.

Irish finance minister Michael Noonan said it “would build trust” if the Greeks legislate as soon as next week on some of the reform plans, especially after Tsipras’s majority was “eroded” by the parliament vote.

Arguing that the mix of tax hikes and spending cuts was better on many points than the package rejected by voters in a referendum on Sunday, Tsipras insisted that he had won important concessions on restructuring Greece’s enormous public debt.

He said the new proposal, if approved by global creditors, will provide longer-tern financial support for a nation that has suffered six years of recession. It would be the first nation to do so.

But Germany is sceptical of the plans after five months of stuttering negotiations – it has previously been Greece’s biggest creditor in two previous bailouts totalling 240 bn euros.

“Confidence has been ruined by every Greek government over many years which have sometimes made promises without making good on them at all“, Sapin said, adding: “Today we need to have confidence again, to have certainty that decisions which are spoken of are decisions which are actually taken by the Greek government”.

The chairman of Eurogroup finance ministers confirmed receiving the documents but will not comment until they have been assessed by experts from the European Commission, European Central Bank and global Monetary Fund. US stock futures jumped 1 percent in early Asian trade on the announced measures.

German officials are reportedly furious Mr Tsipras has submitted an offer that details merely the same terms as a proposed extension of Greece’s last bailout deal, which was only due to last a few months.

“From here on there is a minefield, and I don’t have the right to dismiss or hide it from the Greek people”, he said.

The finance ministers’ meeting will be followed Sunday by a summit of European leaders to determine whether Greece should get new financing.

“Now I have the feeling we’ve reached the… line”.

Tsipras was elected in January after promising to end the austerity measures which he said had driven the Greek economy into the ditch and needed to be replaced by a major stimulus programme.

Although some ministers took pains to highlight how everything must be done to make sure Greece stays in the Eurozone, they were also skeptical of the proposed reforms.

In an early morning tweet, European Union president Donald Tusk said the eurozone summit would start in mid-afternoon “and last until we conclude talks” on Greece.

And if Greece wants more money, it would have to do more than just promise reforms. While Tsipras’ proposal will come under fire from the more liberal precincts in his party, it is expected to win approval.

Jeroen Dijsselbloem, who chairs the meeting of eurozone finance ministers said “the issue of credibility and trust was discussed” and overall the Greek bailout talks are “still very hard”.