The Hindu Business Line
EU seeks to calm Budget conflict with Greece
Austerity-wracked Greece could strike a deal with its creditors by early next year, a senior EU official said on Sunday, seeking to calm a recent row over surprise handouts announced by Athens.
European Commission VicePresident Valdis Dombrovskis made the comments days after the EU suspended debt relief for bailed-out Greece after its maverick premier Alexis Tsipras hiked spending for pensioners, angering austerity champion Germany.
“We think that with a constructive attitude on all sides, a technical level agreement will be found in the next few months,” he told a Greek daily in an interview. In that perspective, a second examination of Greece’s budget plan “will be concluded by the start of 2017”, he added.
Tsipras sparked a new row with its European creditors last week after announcing handouts including a surprise one-off payout to 1.6 million low-income pensioners and a sales tax break for islands sheltering thousands of migrants.
EU cracks whip
On Wednesday, EU finance ministers suspended debt relief for Athens, in a new setback in the Greek debt crisis as the Euro Zone and the International Monetary Fund battle over how far to push Athens on implementing more tough policy reforms.
But the stand-off revealed divisions at the heart of the Euro Zone, with French President Francois Hollande defending Athens and saying it should be “treated with dignity” and not forced to make even more of an effort.
The handouts announced should not significantly change Greece’s budget forecasts for 2017 or 2018, Athens’ European creditor institutions have said.