European Union officials have warned Greece that it has just three days to prove to lenders that it can deliver on the conditions needed for it to receive the next round of bailout funds.
Negotiators told Reuter’s news agency that there was general dissatisfaction with the progress Greece has made in reforming the debt ridden nation’s public sector. The Troika is demanding that the Greek government imposes more austerity measures by hiking taxes and slashing jobs.
Unless Athens can convince its lenders that it will stick to the agreed targets it could miss out on receiving the next round of funds worth €8.1 billion. There is a general dissatisfaction with progress in Greece when it comes to reforming its public sector, such as tax and custom collection or health care services, a senior Euro zone official involved in negotiations said.
Tension is building in several European countries. Portugal’s finance Minister resigned yesterday in what could prove to be a big blow to the country’s austerity drive and its exit from the IMF-EU rescue programme.
In Italy political tension rose after a member of the coalition threatened to withdraw from Enrico Letta’s government. The Civic Choice party headed by former Prime Minister Mario Monti warned that ‘Without a change in direction, we do not think that in the long-term we will be able to support a government impacted by growing ambiguities’.
Unemployment continues to rise and with so many out of work tensions and anger is likely to surface once again.
The news has caused the Euro to weaken against the Pound and US Dollar as risk aversion creeps into the markets. Concerns that the situation in Greece could reignite the Euro crisis have seen investors look for safety in haven currencies.
Euro (EUR) Exchange Rates
As of 11:05 am GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3020
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8570
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6726
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4185
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.3711