Forex News – Greece implements new tougher austerity measures to ensure additional financial aid

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Greece has shown that it is willing to implement reforms to tackle its debt crisis, said the head of a European Union task force, Horst Reichenbach, after his visit to Athens. The Greek cabinet agreed to pension cuts, layoffs, new taxes .

“In my talks with ministers in Greece last week I have established that there is a great willingness to really implement the reforms, not just to have them on paper,” said the German official in an interview on German ZDF television.

“One of the most difficult tasks for the task force would be to help Greek banks to lend again” he said.

On Wednesday Greece announced it has adopted yet more austerity measures to secure its next bailout instalment in order to avoid running out of funds next month. Greek debt has increased European banks exposure to risk. The IMF warned that Europe’s sovereign debt crisis creates great risk of bank losses.

A Greek government spokesman said that high pensions will be cut by 20 percent, 30,000 civil servants will be put in a “labour reserve” on a road to redundancy, and will extend a real estate tax, all in an effort to satisfy requirements in order to receive international financial aid and to comply with the bailout plan through 2014.

The new austerity package is designed to ensure Greece gets an 8 billion euro rescue loan vital to pay state salaries and bills in October. Senior European Union and International Monetary Fund officials are to arrive in Athens early next week to review progress.