Greek Spending Cuts Clear Way for Loans

This is the VOA Special English Economics Report, from http://voaspecialenglish.com | http://facebook.com/voalearningenglishGreece has approved a plan to cut spending, raise taxes and sell government-owned assets. The approval cleared the way for seventeen billion dollars in loans from the International Monetary Fund and the European Union. The loans are a share of the one-hundred-fifty-six-billion-dollar rescue deal that Greece secured last year.The money will help the government to operate and pay its debts until the middle of September. But the austerity plan led to a two-day general strike in Greece and violent demonstrations in Athens. Several hundred protesters and police were injured. Parliament approved the plan on June twenty-ninth, and agreed to the details the next day. Prime Minister George Papandreou won more support than expected for his proposals. He appealed to parliament to do everything possible to avoid defaulting on the debts of the birthplace of democracy. "There is a choice," he said."We can remain a Greece which has a huge public sector, or change to a Greece which has an effective democratic and productive public sector."Greece is expected to seek more international help, even though years of government borrowing led to the crisis. Many protesters said their government is making decisions that only serve the interests of wealthy nations. But other Greeks see the need for austerity. One man said: "I think the policies are a good step towards finding common ground with the European Union ... I don't think any country can operate in isolation these days, especially a country the size of Greece."On June twenty-eighth, the International Monetary Fund chose French Finance Minister Christine Lagarde as its managing director. Ms. Lagarde received support from the United States and European nations as well as Russia, Brazil and China. The international lender has always been led by a European, but Ms. Lagarde is the first woman. She has promised to be a strong voice for developing countries, especially in Asia and Africa. But international monetary expert Domenico Lombardi says being a European "from a key euro area country" will also help. He says she can pressure other European finance ministers to take "a more aggressive stance on the European crisis."For VOA Special English, I'm Alex Villarreal. For more programs on different subjects, go to voaspecialenglish.com, where you can learn English and stay informed every day.

(Adapted from a radio program broadcast 01Jul2011)