German finance minister Wolfgang Schaeuble is due in Athens Thursday (18 July) just as the Greek parliament, amid large street protests, passed a bill that will see thousands of public sector jobs cut.
The reform bill, needed to secure a €8.6bn tranche of bailout money, will see around 4,000 public sector workers – including teachers and school guards – face dismissal.
On top of that 25,000 civil servants are to be ‘redeployed’ by end of 2013. Under this scheme, they will receive 75 percent of their wages and have eight months to find employment in another department or be made redundant.
Greece’s public sector where jobs are guaranteed for life has long been criticized for being too bloated and inefficient but the cuts come on top of years of hardship, high unemployment and recession as the country seeks to meet the terms of its EU-IMF bailouts.
Earlier this week, Greece saw its fourth general strike of the year while thousands protested in front of the parliament on Wednesday.
“We will continue climbing up the hill, we will reach the top, which is not far, and better days will come for our people,” said Prime Minister Antonis Samaras, according to Reuters.
“This is not the so-called human sacrifice that some claim. This is a marked improvement of our public sector and is what Greek society is demanding,” he said.
Much of Greek anger has been directed at Germany, one of the strongest proponents of austerity measures.
Schaeuble sought to address this before his Thursday visit, noting that he is not the “super-troika,” in reference to Greece’s trio of external lenders.
“My visit comes at the request of the Greek Prime Minister to show that we trust Greece, that we want to do everything we can bilaterally to support Greece on its difficult path,” he told German ARD television.
He is due to offer €100m for a fund to promote economic growth with Greek unemployment at 27 percent and around double that rate among young people.
But calls for further debt relief for Greece have fallen on deaf ears, largely due to federal elections in Germany in September.
It is Schaeuble’s first visit to the stricken country since the financial crisis began in 2009 and comes as Berlin has been trying to improve its reputation among southern EU countries, including by insisting on fast-tracking money to tackle youth unemployment, holding a jobs summit, and giving bilateral aid to Spanish small businesses.