The Greek Parliament gives the green light to the new austerity measures equal to 2% of the GDP imposed by the former Troika and passes the baton to Brussels that the Eurogroup on Monday should present its plan to cut the Greek debt. “We have reached the last step of the crisis – said Prime Minister Alexis Tsipras – we have before us the end of the tunnel and in 2018 we will leave the memorandum”. “You are making us sign a fourth sacrifice agreement after promising that the cuts were over – Nea Demokratia leader Kiriakos Mistotakis said – it is better to go straight to the vote and see who the voters believe”. The Syriza-Anel executive, however, has held and the maneuver has passed with 153 votes in favor (without defections in the majority) and 128 against. For the second consecutive day a few thousand protesters protested in front of the Parliament against the compress with the former Troika. And on the sidelines of the demonstration, some incidents with the police broke out with the launching of tear gas and incendiary bottles.

The new measures approved in Parliament set out in detail the measures that the government will have to take in 2018 and 2019. The first year will trigger the thirteenth cut on pensions, equating to new treatments even previous ones and eliminating some benefits. In 2019, on the other hand, the tax-free income threshold will be lowered. The combined action of the double intervention (also accompanied by liberalizations in the energy sector and some professional orders) should generate 4.5 billion between savings and new revenues. If Athens respects all the budget targets set by the creditors, Tsipras – which has already brought home the reintroduction of collective bargaining since 2019 – will be able to launch some compensatory social measures that year, raising the incentives for the first home for the poorest families.
The OK of the Greek Parliament now leaves the ball in the hands of Brussels. Monday’s Eurogroup will look at Greece’s progress. And according to the commitments, it should give the green light to a plan for restructuring the country’s debt, reaching 179% of GDP. The Monetary Fund has been asking for this for some time as a condition to continue to participate in the bailout plan and the ECB demanded it yesterday as a necessary condition to include Athens in its Qe program, allowing the country to return to issue government bonds and exit from the era of capital controls. Eurotower expects a detailed plan on measures (lower rates and longer deadlines) to ease the financial burden on the Parthenon. Maybe they will arrive, but it is likely that their implementation can only start from 2018 if all the objectives are respected. A condition imposed by Germany to avoid complicating Angela Merkel’s journey towards the autumn elections.