The long list of prior actions the Greek government has to implement in order to receive the 2-billion-euro subtranche from its bailout program has generated strong reactions among Greek citizens.
Greece’s creditors expect Athens to proceed with the measures and reforms in order to complete the first review of the progress as dictated by the bailout program. A positive first review is a prerequisite for the European Stability Mechanism to proceed with the recapitalization of Greek banks and the release of the 2 billion euros.
European Commission Vice-President Valdis Dombrovskis stressed that a positive first review is a prerequisite for bank recapitalization. If banks are not recapitalized by the end of the year, there is a good possibility that there will be a haircut of deposits over 100,000 euros.
However, Athens delays the implementation of the unpopular measures. Prime Minister Alexis Tsipras is asking Europe to ease the bailout program given that Greece is pressed by the extraordinary refugee influx.
The Greek government is receiving a lot of pressure from social and professional groups. On Monday, pharmacists across the country went on strike, while farmers are preparing for mass demonstrations and blocking the nation’s thoroughfares.
Pensioners are also reacting to the harsh pension cuts and the increase in the retirement age. At the same time, parents and private schools oppose the implementation of a 23 percent value added tax rate on private education. Tsipras postponed the decision on private education VAT until November 1st, but it is unlikely Athens would find equivalent revenues from other sources.
On the issue of bad loans, the Greek government is trying to save house loan debtors from foreclosure by proposing a ceiling of property value to 350,000 euros, while creditors ask for a limit of 120,000 euros.
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