Members of German parliament vote by a large majority to approve new powers for EU’s bailout fund.
George Papandreou, the Greek prime minister, has held talks with French President Nicolas Sarkozy in Paris in a bid to get his country’s support for approval of the next tranche of Greece’s bailout.
The two met in Paris on Friday, as Papandreou continued a tour of European countries, hoping to reassure EU members that Greece would be able to pay back bailout loans made through EU financial institutions.
Sarkozy said after his talks with Papandreou that he would be meeting German Chancellor Angela Merkel “in the coming days” to discuss “the collaboration and co-ordination works between Germany and France that has ensured the protection of Europe”.
He said Papandreou had assured him of the “total determination of the Greek government scrupulously to put in place all commitments that Greece has taken on”.
“Failure of Greece would be failure for all Europe, there is no other credible alternative,” Sarkozy said.
He termed the obligation to support Greece both a “moral” and economic one.
“Germany and France are the big two in the eurozone. The Greek prime minister [is] obviously rushing around at the moment trying to win friends and influence people,” Al Jazeera’s Jacky Rowland reported from Paris.
The German parliament approved a proposal on Thursday authorising new powers for the eurozone’s $592bn bailout fund.
Inspectors shut out
In Athens, meanwhile, civil servants continued their sit-in at Greek ministries, forcing international debt inspectors to reschedule a meeting where they were due to discuss reforms, including new licensing laws for taxis.
Yannis Ragoussis, the transport minister, was due to hold a meeting with inspectors from the European Central Bank, the International Monetary Fund and the European Union [collectively known as the troika] on Friday morning at the transport ministry, but found the building under occupation by protesting employees.
A similar meeting with Evangelos Venizelos, the Greek finance minister, was moved to a different government building on Thursday after that venue was also occupied.
Protesting civil servants continued to guard the entrance to the finance ministry on Friday morning, spraying the words “They shall not pass” across drawn-down metal shutters.
A lockout at the national statistics office ELSTAT, meanwhile, forced the agency to postpone the publication of two sets of economic indicators on Friday.
Inspectors from the troika returned to Athens this week after having earlier suspended their review over missed targets and delayed implementation of reforms.
The inspectors’ approval is required for Greece to receive the next $10.8bn instalment of its
$149bn bailout loan package, which was agreed upon last year.
Without the next trance of its loan package, Greece says that it only has enough funds to last through mid-October, after which it will be unable to pay salaries and pensions.
With the Greek economy in a deep recession, and growing anger among citizens at spending cuts the bailout makes it obligatory to make, the government has found itself unable to meet all of the targets agreed upon.
Faced with the prospect of a Greek default dragging down the European common currency, EU members approved a second $147bn bailout for the country on July 21. The details of that deal, however, are yet to be finalised.
In a bid to ensure that the troika’s inspectors return and approve the sixth batch of bailout disbursements, the government announced it would launch a series of new measures, including imposing a property tax, pension cuts and the suspension of about 30,000 civil servants on partial pay by the end of the year.
Greeks have been outraged at the new cuts, after more than a year of similar cuts that have seen salaries and pensions reduced, with simultaneous tax increases on income, property and consumer goods.
Unions have been holding daily demonstrations in central Athens, with many gathering to burn notices demanding an emergency tax.
Civil servants have declared a 24-hour strike for October 5, which will include the grounding of all flights to and from the country.
A nationwide strike has been declared for October 19.
Meanwhile, Greek betting firm, OPAP, agreed in principle on Friday to pay $1.28bn to extend its sports betting monopoly and secure other licences.
The deal is the second such money-raising agreement since the government announced in June that it would be raising $67.5 billion in asset sales over five years.