Austria blocks monthly Greece aid

Austria has not yet given the green light to transfer its December rate to fellow European Union (EU) member Greece, it has emerged.People’s Party (ÖVP) leader and Finance Minister Josef Pröll announced today (Tues): “Statistics give no reason to hand over the money from an Austrian point of view.”Pröll argued that figures have shown that the debt-stricken country has raked in too few taxes since its near collapse earlier this year.The International Monetary Fund (IMF) agreed with EU leaders in May to support Greece with an overall 110 billion Euros. The IMF and the EU also decided to set up a 750-billion-Euro European Financial Stability Facility (EFSF) fund to protect any EU member states from going bankrupt.Speaking about the 190 million Euros in credits Austria was set to provide to the Greek government next month, Pröll claimed the country failed to match the requirements spoken out by the EU earlier this year. The minister stressed he will express his criticism at the upcoming meeting of the EU’s federal finance ministers.Pröll only recently hit out at the Slovakian government for its decision not to participate in the EFSF. “It’s not acceptable for Europe that Slovakia ignores an EU agreement and goes its own way,” he said in SeptemberThe finance minister also said today he will try to convince Irish leaders that it is the right decision to accept financial support from the EFSF. Pröll said it was “paradox” that the ailing country apparently has to be persuaded to accept financial support from the new special purpose vehicle.Pröll warned there would be the “risk of an infection” of other financially struggling EU member states if Ireland rejects subsidies. The Austrian vice chancellor stressed he had no plans to force Irish government chiefs to accept the support, but added that he planned to discuss the issue with them.Asked which other EU members were potential trouble spots as far as their state finances were regarded, the minister mentioned Portugal.Josef Bucher, head of the Alliance for the Future of Austria, has called for the “erection of a stop signal” in Brussels to further payments as part of the EFSF.The right-winger called on Pröll to make clear that Austria was not willing to fork out more money to other states but Greece such as Ireland.Freedom Party (FPÖ) General Secretary Herbert Kickl warned of consequences the EU would face if it decided to financially back all struggling members of the Eurozone. This term describes the 16 EU members which use the Euro as their sole currency.”There are alternative scenarios such as being expelled from the Eurozone in order to reintroduce their former currencies,” Kickl said, adding that he also could imagine ordering the affected states to start controlled state bankruptcy proceedings.Austria is generally considered as one of the EU’s model pupils as far as federal state budgets of its members are regarded. The Austrian budget deficit, nevertheless, rose by 3.5 per cent year on year to a whopping 3.9 per cent of the gross domestic product (GDP) last year when businesses felt the pinch of the global crisis.Economists have said the recently announced package of austerity measures will help the government of Social Democrats (SPÖ) and the conservative ÖVP to push the deficit below three per cent by 2013. They, however, also warned that the state debt was set to rise further beyond 70 per cent of the GDP at the same time.