Greek Political Leaders Approved the Austerity Plan

On Sunday night, the Greek parliament approved a deeply unpopular austerity package needed to secure a 130 billion euro bailout and save Greece from a default next month.

The austerity plan includes 15,000 public-sector job cuts, liberalisation of labour laws and lowering the minimum wage by 20% from 751 euros a month to 600 euros.

A majority of 199 members of parliament voted to approve the package, with a total of 74 voted against it. More than 40 rebel deputies were immediately expelled by their parties, after they voted against the package.

Last week, the EU ministers rejected the proposal put forward by the Greeks, as it fell 325 million euro short of the cuts needed. The EU finance ministers will convene in Brussels on February the 15th for an extraordinary meeting to ratify the final measures before bailout funds can be released.

Greeks are increasingly angry with the austerity plan and feel that the impact is beyond the value of the bailout. Tens of thousands protested in Athens, where there were widespread clashes and buildings were set on fire. There was also violence in cities across the country.

Prime Minister Lucas Papademos urged calm, insisting that the austerity package would “set the foundations for the reform and recovery of the economy”.

Source: BBC

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Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.