Greece Gets a Piece of the Second Leg Down
European finance chiefs said Greece may have to step up its efforts to tackle a national fiscal crisis that threatens to spread to other countries across the region.
“The Greek government is aware of the magnitude of the problems facing the country,” Luxembourg’s Jean-Claude Juncker told reporters in Brussels late yesterday after leading a meeting of euro-area finance ministers that discussed Greece’s budget plan. “The measures are a step in the right direction. We’ll have to see whether they’re enough.”
Greece last week presented its plan to push down a budget deficit that is still more than four times the European Union limit of 3 percent of gross domestic product. European Central Bank President Jean-Claude Trichet on Jan. 14 turned up the pressure on Greece, saying no nation can expect any “special treatment” after rating downgrades sparked a rout in Greece’s bonds in December and fueled concerns about default.
The Greek government’s latest proposals call for about 10 billion euros ($14.4 billion) of spending cuts and revenue increases this year to bring the budget shortfall from 12.7 percent of output to 8.7 percent by year end.
“The Greek plan leans heavily on the income side,” Dutch Finance Minister Wouter Bos said after yesterday’s meeting. “It leans heavily on one-time measures,” he said, adding that the program “needs to be more substantial.”
I thought everything was totally cool? What happened to that version of events around the globe?