The implications begun on Tuesday morning when the IMF started questioning the viability of the Greek debt if the Greek plan was to be accepted. Following this, Mrs. Lagarde asked for more budget cuts and less taxation. The Greek side insists that the main measures must include higher taxes for the well off as this more in agreement with the politics of a leftist party and it would be easier to pass in the parliament. Mrs. Lagarde, who is personally involved in the negotiations, insists that the IMF can not accept a program based on “dirty numbers” which will never become real.
In the meantime, while the Greek government is trying to negotiate these details, the political side of the Greeks insist that there can be no deal unless a clear mentioning of the restructuring of the Greek debt is included as well as a clearly defined “growth package”.
On the other hand, the creditors want to merely include a vague promise that hey will start discussing such a restructure at some point in the future and only after Greece has voted all the necessary laws. This leads to a catch 22 as the Greek side insists that it will be unable to pass those laws through the parliament unless such a commitment is included.
Hostile Negotiations in Brussels
The Prime Minister of Greece is visiting Brussels in order to participate in a meeting between the heads of the IMF, the ECB and the European Commission. Sources from the Greek government assure that unless the package insures the country’s growth there will be no deal.
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