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I had the opportunity to meet with Chancellor Faymann today, who is not only a sincere friend of Greece but also a politician with nuanced views regarding Europe’s future. Namely, how Europe can move forward while managing the challenges of the times, and create a promising future for its people.
Chancellor Faymann believes in European solidarity. He recognizes that Europe will continue to be affected by the crisis if it does not ensure social cohesion and development, and instead relies solely on harsh austerity measures.
I had the chance to thank him for supporting the efforts of the Greek government in their objective to attain a fair compromise and a sustainable economic agreement. Such an agreement would help Greece exit the vicious cycle of recession and austerity, and would categorically end the ongoing discussion of the Greek problem.
I also had the chance to inform him about the recent developments concerning the negotiations. I made clear that Greece fully responded to the institution’s demands regarding the country’s financial gap, and how this would be covered.
Our proposals provide for attaining the financial targets set by the institutions for 2015 and 2016. Moreover, I informed Mr. Faymann that we have submitted a complete proposal addressing the institutions’ requirements on the aforementioned targets, as well as specific financial measures and reforms.
While our proposals do not include excessive VAT increases on electricity and medication, they do outline other channels that would lead to a significant increase in revenue, allowing a return of approximately 1% of GDP.
The gradual elimination of early-retirement pensions in 2016 would provide a total savings of 2.5 billion euro for 2016-2022. Obviously, we cannot reach the 1.8 billion euro mark for 2016; the number will be closer to 300 million euro, which will still make for a very important reform. I want to highlight that during 2010-2014–the Greek Memoranda period–13 billion euro were lost due to a series of harsh austerity measures from the country’s social security system, while benefits were reduced by almost 50%. As a result of the PSI (i.e., social security funds “haircut”), the social security funds lost 25 billion euro. Any further reduction would jeopardize the very existence of these funds.
I explained to the Chancellor that our proposals fully cover the fiscal adjustment required by the institutions. Furthermore, as a sovereign state with a recently elected government supported by its people, Greece alone is responsible for the allocation of its taxes, and for finding the required funding.
Insisting that this money should come from a further reduction of pensions is incomprehensible; a political agreement is needed–not with persistent technocrats, but with Europe’s political leaders.
If Europe supports such an incomprehensible attitude, if political leaders insist upon this, then they should be prepared to bear the cost of what happens next–which would not be favorable for anyone in Europe.
The Greek government does not want this to occur. The Greek government wants a fair compromise and a sustainable economic agreement. This is, in a nutshell, what I explained to the Chancellor, and I am sure that he will do whatever he can –as he has done so many times in the past- to make this agreement feasible. Therefore, I am sure that he will be creative and effective over the course of the next few days so that we will have a positive outcome– both for Greece and for Europe.
Greece and Austria are two countries that traditionally have been on very good terms. We are determined to continue this tradition and encourage our close relations and friendship. Each year Greece welcomes millions of Austrian tourists who love our country, and are frequent visitors; they not only appreciate our environment, but also our culture. We have great respect for Austria’s culture and history as well, including its accomplished and famed composers and intellectuals.
Although we may be geographically far or have differing temperaments, the bottom line is that we are rather close. And we will continue, both Chancellor Faymann and myself, to further our countries close relations and our peoples’ friendship, as well as to champion solidarity in Europe and the prosperity of all Europeans.
