Greece approves more austerity cuts

Greece’s parliament has approved a budget plan filled with over 3 billion euros of austerity cuts with the hope that the debt-laden country will emerge from a six-year recession next year.

After nearly going bankrupt and almost crashing out of the euro zone last year, Greece expects growth of 0.6 percent in 2014 and hopes to secure more leeway on its debts to the European Union and the International Monetary Fund.

“This is a historic day,” Prime Minister Antonis Samaras told lawmakers on Saturday, calling the 2014 plan a budget of recovery and hope.

“People’s sacrifices bore fruit and changed the course of the country, he added.”

Outside parliament, an anti-austerity rally called by the country’s largest labour unions drew only a few hundred people, a shadow of former demonstrations where tens of thousands took to the streets of Athens to protest the belt-tightening.

A total of 153 lawmakers voted in favour of the 2014 budget plan in the 300-seat house. Samaras’ conservative-led coalition controls 154 seats in parliament.

Athens sees a budget surplus before interest payments at 812 million euros in 2013 thanks to higher than expected tax revenues.

Posting a primary surplus is key as it would open the way for Greece to pursue debt relief from the EU and IMF.

But Athens and its lenders disagree on the forecasts for 2014, arguing over the size of a potential budget gap next year
and the slow pace of reforms.

International lenders have not given their approval for the plan, which sticks to a target for a primary budget surplus (before interest costs) of about 1.5 percent of GDP next year, and have said that unless it found new savings, Athens would miss its surplus target by about 2 billion euros.