16:33 | 29/08/2016 Global Economy
Greece said on August 28 the EU was "sleepwalking towards a cliff" by sticking to austerity rules that created huge inequalities among members, and it expected a debt relief deal for itself to be honored by end-2016 so that its economy could recover.
Greek Prime Minister Alexis Tsipras arrives at the PGE National Stadium, the venue of the NATO Summit, in Warsaw, Poland on July 8, 2016 - (Credit: Reuters)
Athens, facing a second bailout review entailing an unpopular loosening of labor laws in the autumn, is keen to show that painful tax rises and pension cuts as part of its 86-billion-euro bailout deal last year will bear fruit.
Greece has committed to attaining a primary budget surplus - excluding debt servicing costs - of 3.5 percent of economic output by 2018 as part of its third bailout package since 2010.
The IMF, which has yet to decide whether it will fund the third bailout, has said that surplus targets of 3.5% beyond 2018 are not realistic for Greece and has pushed for softer fiscal goals to take part in the financing.
Greece's leftist-led government and the central bank also want lower primary surplus targets, arguing this will give Athens room to cut taxes and help the battered economy return to growth after a protracted recession.
The economy has shrunk by a quarter in six years and the jobless rate is 23.5%.
He criticised Germany for acting as Europe's "savings bank" with excessive surpluses, frozen wages and low inflation, at a time when the EU's deficit-ridden southern members have broken all records for unemployment./.