"EU must negotiate reform and reconstruction plan with Greece" say S&Ds

"EU must negotiate reform and reconstruction plan with Greece" say S&Ds

S&D Euro MPs today called on the EU and the new Greek government to negotiate a "reform and reconstruction plan for Greece, replacing the current bailout programme designed by the Troika".

In a political document adopted today in Strasbourg, the Socialists and Democrats argue that the future plan must be a joint plan, genuinely responding to the concerns of the Greek people, while remaining acceptable to other EU governments and institutions, and the people they are accountable to.

"Therefore it should be negotiated between the Greek government and the European Commission and Council, under the supervision of the European Parliament."

S&D Group president Gianni Pittella said:

"We demand that the EU institutions and not the Troika negotiate a global plan with the Greek government.

"Europe should ensure that Athens is given enough fiscal flexibility to be able to implement progressive reforms, revive the economy and begin to reduce unemployment, poverty and the large social inequalities that weigh down upon the population.

"It is clear that the Tsipras government must play a constructive role in this unavoidable debate – or face disaster. We realise that we cannot deal further tough blows to an exhausted country. What we can do, however, is ask Greece to make serious and, up to a point, stringent commitments as regards the public sector, tax policy and the fight against corruption."

S&D Group vice-president responsible for economic and monetary affairs Maria João Rodrigues added:

"Greece's problem is also Europe's problem. Greece should get more time to repay its debt, so that more money is left in its budget to support a new agenda of progressive reforms and investment.

"The size of Greek public debt – over 170% of GDP – is partly the result of the flawed Troika programmes, based on austerity, massive cost-cutting and wrong economic forecasts. It would be cruel to demand a huge budgetary surplus from Greece in the decades to come, just to keep the current repayment schedule. The EU needs to ease the debt burden by lowering interest rates and allowing more time for repayment, so that the country can also invest in building a healthy economy.

"In exchange, the Greek government should be fully committed to implementing ambitious progressive reforms. These reforms should be centred on modernising the public administration, improving tax collection, stepping up fight against tax avoidance and corruption, investing in education and building a functioning welfare and health system.

"How the Greek crisis is handled will tell a lot about how the eurozone is able to deal with its economic and social problems. After years of suffering, Greece and the whole Economic and Monetary Union need different economic policies, focused on growth, investment and social cohesion. The eurozone needs stronger common instruments and more solidarity, otherwise it will face even bigger financial and political problems than it has up to now."

The full document is available below.

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Preventing a new Eurozone crisis: Towards a New Deal for Greece and the EMU