Troika 'Blackmailing' Greece: Opposition Party
The economic advisor to Greece's anti-austerity party SYRIZA told CNBC that Greece's international lenders, the troika, were "blackmailing" his country and not helping it to exit recession.
"The situation is not becoming better in Greece, we still have a very big recession for a fifth year…and this cannot go on," Yiannis Milios, economic advisor for the Coalition of the Radical Left (SYRIZA) told CNBC on Monday.
"What we see from the side of the troika and the Greek government is the continuation of the same policy which creates this negative cycle of recession, indebtedness and cuts which fuel recession…We need a change of policy we must come to a new era and try to boost growth," he told CNBC's "Worldwide Exchange."
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Milios' comments came as the Greek finance ministry decides whether the country's biggest lenders, the Greek National Bank and its subsidiary Eurobank, should be merged. International lenders raised concerns about their integration plans and so the lenders will be recapitalized separately, Reuters reported on Sunday, citing two bankers.
The economic advisor for SYRIZA, a party that fought against austerity measures in last year's general election, rejected the possibility of Greece being forced to leave the euro if it did not keep to the conditions of its bailout.
He called demands from the troika (the European Central Bank, International Monetary Fund and the European Commission) for more spending cuts in return for a further 9 billion euro aid package (it has already received 130 billion euros in aid), tantamount to "blackmail."
"This is blackmail of the Greek people, we can achieve the targets [set by the troika] by using other means, if we change policy and change the government I don't see why we won't be allowed to balance the budget by a more just system by protecting people who are at the limit of poverty or even below that."
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Greece is the euro zone's most heavily indebted country, with debt exceeding 170 percent of gross domestic product. The IMF forecasts that this will rise to 182 percent in 2013. The country's economy has shrunk by nearly 25 percent over the last five years and the latest unemployment rate for Greece is 26.8 percent, the highest figure recorded in the European Union.
Austerity measures have included pension and public sector wage cuts that have caused mass protests in the country. Milios said there was an alternative and that a change was needed to the taxation system, which it's claimed, has enabled many wealthier Greeks to evade taxes.
"The alternative is to stop this austerity, to stop wage cuts and the over taxation of the vast majority of the population. We need a more just tax system…We need programs that contain unemployment and boost growth," he said. "The troika has realized that the targets have failed constantly and a change must take place."
-By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt