ATHENS Greece and its international lenders reached a multi-billion euro bailout deal on Tuesday to keep the nation in the euro zone and prevent financial meltdown, officials said.
Here are some of the details of what Greece is required to do for up to 85 billion euros ($94 billion) in fresh aid:
TARGETS
– Greece to produce primary budget surplus starting 2016.
– Primary budget deficit of 0.25 percent of GDP in 2015, followed by surpluses of 0.5 percent in 2016, 1.75 percent in 2017, and 3.5 percent in 2018.
– Greek economy to shrink between 2.1 and 2.3 pct in 2015, contract by 0.5 percent in 2016, and return to 2.3 percent growth in 2017.
“PRIOR ACTIONS”
Some of the “prior actions”, or measures required before bailout aid is disbursed, are expected to include:
– New laws on non-performing loans held by banks.
– Deregulation of the natural gas market.
– Setting up an independent sovereign wealth fund in Greece intended to raise 50 billion euros, three-quarters of which would be used to recapitalize banks and decrease debt.
– Scrapping tax breaks for farmers who now receive subsidized fuel.
– Tighter regulation of a repayment system for individuals owing back taxes to the state.
– A gradual increase in a system under which taxpayers ranging from the self-employed to small businesses pay tax in advance on their forecast income.
– Increase to 6 percent from 4 percent of a “solidarity tax” paid by those earning 50,000-100,000 euros a year.
PASSED
Greece passed a number of prior actions in July including:
– Simplifying VAT rates and applying the tax more widely.
– Cutting back on pensions and making the national statistics agency independent.
– Measures to overhaul the civil justice system- Adopting EU bank resolution and bail-in rules, applicable from Jan. 1 2016.
TO COME
Greece’s bailout agreement is also expected to set a clear timetable for the following measures:
– Ambitious pension reform.
– Reforms covering Sunday trading, pharmacy ownership, milk sales and bakeries.
– Privatization of electricity transmission network.
– Review of rules on collective bargaining, industrial action and collective dismissals.
(Writing by Michele Kambas and Deepa Babington– editing by Giles Elgood)
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