Nelson Lewis Greece

In Greece, protests have been erupting

At a conference call meant to tap the EU’s EFSM emergency fund, Eurozone ministers have recently agreed to give Greece a €7 billion “bridge” loan from an EU-wide fund to keep the country’s finances afloat until a bailout is finally approved.  This loan is expected to be confirmed by the European Commission tomorrow, when it will be voted on in the EU Council.  Talks on this emergency funding started after the Greek parliament passed a series of tough austerity reforms in a vote late last night.  According to correspondents, this should open the way for emergency funding for Greek banks, allowing them to reopen after being closed for nearly three weeks.

Separately, the European Central Bank (ECB) is considering easing a funding crackdown on Greek banks, although correspondents say that a decision might not be immediate.  This Monday, Eurozone leaders agreed on the bailout in principle, on the condition that the Greek parliament passed reforms on taxation increases and pension curbs by yesterday.  Greek Prime Minister Alexis Tsipras won the parliamentary vote by 229 votes to 64, although he needed the support of opposition MPs to do so.  Despite the fact that his left-wing Syriza-led government lost its majority, it’s expected that his government will survive.  This paves the way for eurozone finance ministers to open detailed tasks on the bailout, which could be worth up to €86 billion.  Earlier today, Finland’s parliament approved the bailout talks, while Germany’s parliament is due to vote on the deal tomorrow.  German Finance Minister Wolfgang Schaeuble has said that he’d submit a request for parliament to reopen negotiations on the third bailout with “full conviction”.

Passionate opposition to Tsipra’s reforms has come from within his own Syriza party; parliamentary speaker Zoe Constantopoulou referred to the measures as “social genocide”, while former Finance Minister Yanis Varoufakis said that he was “forced to accept them”.  In the meanwhile, the situation in Greece has been anything from ideal; since capital controls were imposed and the banks shut in late June, the Greeks have been limited to withdrawing €60 a day.  By July 22, Greece needs to commit to a major overhaul of the civil justice system; it has to agree to more privatization, to review collective bargaining and industrial action and make market reforms.  Earlier today, a vote approved an increase in luxury taxes, an increase in corporation tax from 26% to 29% for small companies, increasing the retirement age to 67 and VAT changes.