The Minister of Finances Yanis Varoufakis has persisted upon the adoption of 70% of structural reforms contained in the existing bailout agreements, with the remaining 30% considered “toxic”.
In accepting such a possibility though, the European Commission chief Jean-Claude Juncker has demanded that the toxic 30% be replaced by equal, alternative measures.
Sources suggest that the Greek government is willing to adopt the following structural reforms of the existing bailout agreement:
- New Ethics Code for banks
- Changes in the Judicial Code
- OECD report on administrative burden
- Taxation of collective investment vehicles
- Broadening the definition of tax evasion and tax fraud
- Changes in personal and company insolvency
- Reforms in wages
- Changes to legislation on the budget
- Addressing legal hurdles in competitiveness, as noted in OECD report
- Changes to investment permits
- Changes to the government’s Accounting Plan
Additionally, the Greek government is said to have declared that it will not accept the following prerequisites for the completion of the troika’s final review:
- VAT reform
- Reduction of non-wage benefits
- Changes to collective dismissal legislation
- Changes to union actions legislation
- Reform of pension system
The Greek side also wants to reduce the annual primary surplus goals (from 4.5% at present to 1.5%), in order to have the necessary “fiscal room” to carry out the reforms that are necessary. Nevertheless, the creditors appear to demand that the “toxic” measures be replaced by other, equal measures, which the Greek government is not willing to accept.
