The time has finally come for Greece’s fate to be decided. On Wednesday, the Greek Parliament is scheduled to vote on new austerity measures, the approval of which is necessary to ensure the country receive the last $17 billion of last year’s $156 billion aid package from the EU and IMF.
The austerity measures include reductions to the salaries of public workers and an increase in the attrition of public jobs. The austerity measures are estimated to be worth roughly $112 billion to the Greek economy.
EU finance ministers will vote on whether to approve the fifth tranche of bailout funding on Sunday, July 3.
If Greece does not receive another bailout package, the country runs the risk of defaulting on its debts, which would not only spell disaster for their economy, but would disrupt the European banking system, which would in turn disrupt banks and markets in the U.S.
Given the importance of the bailout money for Greece, it seems likely the austerity measures will pass. However, given the importance of Greece’s survival to the global economy, it seems unlikely the EU would withhold aid money that could prevent default, whether or not Greece passes the austerity measures Wednesday.
The measures have been hotly debated in parliament, and should the measures pass, it is likely to be by a small margin. The measures have not been popular with the public, and many citizens have been protesting outside of parliament in Athens, with protests at times erupting in violence. The country has already witnessed austerity measures that have resulted in lost jobs and massive salary cuts for those lucky enough to still be working in the public sector, as well as increased taxes and decreased benefits.