At the meeting of the 17 Eurozone finance ministers today,Greece willlearn if it will receive the 14.5 Billion euro tranche of funds so that it can pay its creditors by March 20.
The release of funds was contingent on Greece passing more austerity measures, which are to include tax hikes, wage cuts and public sector layoffs. Greece's public sector employs 1 out of 4 Greek workers, the bloated sector has caused a drain on the wider Greek economy.
The public sector was allowed to grow as kickbacks in exchange for votes, that all parties in Greece participated in. 750,000 jobs have been lost in Greece so far the vast majority in the private sector,minimum wage is set tobe cut by 22%in the latest austerity measures.
The Eurozone and Greek officials are near agreement on releasing bailout funds, after Greece has agreed to new austerity measures. Greece had a week to find an additional 325 Million euros in savings, which it did by slashing 100 Million from the military, and the remainder from public sector wages, health and social spending.
The Troika of the EU, IMF and ECB also wants a further 325 Million Euros in savings to be found this week. The measures had to be passed so that Greece can receive 14.5 Billion Euros in funding by March 20.
Greece has to repay its bondholders which include French, and German banks, and other private lenders such as hedge funds, pension funds and insurers.
The coalition government and the political parties backing it had come under intense pressure to put their commitment in writing to the cost-cutting demanded in return for rescue funds.
The latest bailout agreement also contains a private sector bond swap that will slice €100bn from the country's €350bn debt pile in the hope of bringing it down to 120% of GDP by 2020.
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