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Greece rushes to to finalize reform proposals

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Greece rushed Sunday to finalize a list of reform proposals that it must submit to its eurozone partners by the end of the following day, to unlock an extension of its bailout programme.

These measures are a condition to extend by four months the European share of the cash-strapped country’s rescue package, which is due to expire on February 28. Athens struck the eleventh-hour deal at a meeting of eurozone finance ministers on Friday.

Reports in various Greek newspapers, including the conservative Kathimerini, said the list will consist of promises to overhaul public administration and tackle tax evasion and corruption.

The reform list will also include measures such as deregulation, privatizations and social security reforms, said Aristide Hatzis, an economist at Athens University.

Under the agreement, Greece has promised to not carry out any unilateral actions that would hurt its fiscal targets, economic recovery or financial stability.

What remains to be seen is the extent the new leftist government will be allowed to roll back austerity, as it had promised.

Finance Minister Yanis Varoufakis on Friday confirmed creditors are not demanding austerity measures in the form of additional pension cuts, VAT increases to the Greek islands or a primary surplus target of 3.5 per cent.

Since being elected last month, the government has announced plans to introduce legislation to allow for the repayment of overdue taxes in 100 installments and protect homes from foreclosures – promises the government insists will still be carried out because they do not have a negative budgetary impact.

But it was still unknown whether other pledges to reinstate collective wage bargaining and stop the deregulation of the labour market would still be among the reform list.

Varoufakis expressed confidence late Saturday night the list would be approved by its international lenders – the European Commission, the European Central Bank and the International Monetary Fund.

Creditors will discuss Athens’ reform list via a teleconference on Monday, Varoufakis said. Should they accept it, eurozone countries will have the rest of the week to give their formal approval to the programme extension.

If the list is not approved then eurozone finance ministers could hold a new Eurogroup meeting Tuesday. A handful of countries, including fiscally conservative Germany and Finland, must seek parliamentary approval for the bailout extension.

Greece has received international rescue packages totalling 240 billion euros (273 billion dollars), in return for strict reform conditions. SAPA

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