Countdown to Greek budget vote pits optimists against creditors

Tension mounted Sunday during the countdown to the Greek parliament's vote on a 2015 budget that has brought Athens into conflict with international creditors financing the country's bailout.

The budget proposal lawmakers have been studying since Wednesday forecasts 2.9 percent growth and a deficit of 0.6 percent.

However, Greece's "troika" of creditors — the European Commission, European Central Bank, and International Monetary Fund — regards those estimates as overly optimistic for an economy that shrank by 25 percent since 2008, and is urging Athens to hold the line.

Consequentially, voting on the 2015 budget late Sunday night will pit Greek politicians ready to celebrate the glimmer of returned growth by easing austerity and cutting taxes against parliamentarians heeding troika warnings that it is too early for Greece to sanitise its sickly public finances.

"There's disagreement on the budget, financing needs, scheduled payment of back taxes, VAT, and unfortunately lots of other questions," Thomas Wieser, Austrian president of the Euro Working Group of EU finance ministers, told RealNews Sunday.

Greece's creditors warn that the country's deficit will be closer to 3 percent of GDP, and warn against proposed tax cuts when Athens will need to find an additional 3 billion euros ($3.69 billion) in revenue just to meet its financial targets.

With Greece awaiting delivery of 1.8 billion euros ($2.21 billion) in additional loans from creditors, the government of Prime Minister Antonis Samaras is wary of crossing troika members who have already extended Athens 240 billion euros ($294.8 billion) in bailout funds since 2010.

The tussle over the 2015 budget is also jeopardising Greek hopes to exit bailout restrictions any time soon.

When Athens voiced desire to do so in response to returning growth in October, markets spooked at the idea of Greece freed of outside control sent Greek bonds plummeting.

Since then, Athens has agreed to remain tied to European assistance in 2015, and respect its commitments to the IMF running through 2016, but continued tension and uncertainty over the form of the proposed budget have nerves on all sides frayed.

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