Saturday, January 28, 2012

Euro Officials Discuss Greek Budget Veto Powers

January 28, 2012

European policy makers are discussing plans to directly intervene in Greek budget decisions as the country struggles to cut its deficit, two euro-region government officials said today.

Under the proposals, European institutions would have powers to implement austerity measures agreed under the terms of Greece’s bailout agreements, said one of the officials, who declined to be identified because the talks are confidential. The plan would accelerate decision making and strengthen the power of officials overseeing Greece’s budget as part of the so- called troika of the European Commission, the European Central Bank and the International Monetary Fund, the person said.

European leaders meet in Brussels on Jan. 30 as they draw up a fiscal compact to strengthen governance of the euro region after Greece (GDBR10) sparked a wave of financial turmoil that still threatens to splinter the bloc. With Greece struggling to meet the terms of bailout agreements struck over the past two years, European officials are trying to work out how to deal with countries that can’t meet the terms of bailout agreements.

The Greek government rejects the plan because it’s contrary to national sovereignty, a Greek official said today. A German finance ministry spokesman declined to comment. The French finance ministry didn’t immediately return a call seeking comment.


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