The Greek Parliament voted to endorse a set of tough austerity measures ordered for by its foreign loan providers as a condition for fresh loans to save Greece from defaulting on its obligations.
The voting came after several days of harsh discussions and resignation of some key ministers opposing the austerity measures. Details of the proceedings suggest that 199 legislators voted in favor of the set of measures while 74 opposed it. Besides, 27 legislators remained absent.
The Greek Parliament also approved power for the government to sign fresh loan contracts with the foreign lenders. The parliament also said the government should come up with a wider set up to cut the money Greece is supposed to pay to its bondholders.
In addition to several other provisions, the latest austerity measure counts in 22 percent decrease in the standard minimum wage besides a plan to lay off 150,000 government workers by 2015. This signifies a worrisome future for a country ruined by 5 years of economic slump and joblessness rate that has been rising at 21 percent.
Euro zone leaders have reportedly planned to meet Wednesday to make a decision on bailing out Greece. The conditions also stipulate that Greece must arrange a supplementary $432 million in expenditure cuts.
“There are very few such moments in the history of a nation,” said Greek Finance Minister Evangelos Venizelos, addressing Parliament prior to the voting. “Our country has an acute issue of survival.”
Reports suggest that the yen turned down against the euro and other key currencies after Greek Prime Minister Lucas Papademos got endorsement from parliament for the austerity measures.
“After the Greek vote and the weaker GDP, there was some selling of the yen,” said Lee Wai Tuck, a currency strategist at Forecast Pte in Singapore. “Crosses against the yen, such as euro-yen, actually went higher.”
The approval on austerity measures sparked chaos on the streets of Athens, where around 80,000 people reportedly demonstrated on Sunday. Growing dread was also observed in other cities of Greece. Angry demonstrators in Athens targeted the police with stones while they retaliated with tear gas.
“They’re trying to lay the ground for it, trying to limit the contagion from it,” said Simon Tilford, the chief economist at the Center for European Reform, a research institute in London.