IMF unhappy over proposed Greek minimum wage hike IMF unhappy over proposed Greek minimum wage hike

IMF unhappy over proposed Greek minimum wage hike
07 Feb 2019

The International Monetary Fund (IMF) has expressed concerns over the Greek government’s plans for a minimum wage hike and is insisting that the country cut its tax-free ceiling as of January 2020.

Managing director of the Foundation for Economic and Industrial Research (IOBE), Nikos Vettas also joined the fray, saying that increasing the minimum wage to a proposed €630 (US$723) per month was out of line with Greece’s economic and productivity growth, Ekathimerini reported.

But Labour Minister Efi Achtsioglou told Tornos News that the planned increase, along with the planned abolition of a “sub-minimum” payment level for wage-earners under the age of 25, would have an impact on 24 different subsidies and stipends related to wage scales.

She added that government-mandated increases in private sector wage scales would enhance benefits for the unemployed, college students and working mothers among others, claiming that up to 300,000 people would benefit.

Greece cut its minimum wage from E781 to E580 at the start of 2012 under pressure from the IMF, but this meant it was the only country in the European Union to have a minimum wage lower than in 2008, according to Greek Reporter. 

Meanwhile, the IMF report also warned about increased risks posed to the Greek economy by this year’s national elections, a court decision on pensions and the state of the credit system, Ekathimerini reported. It argued that such risks have recently grown more serious because, on top of the difficult legacy of the country’s financial crisis, which includes high public debt levels, the deterioration of corporate finances and payment problems, there are also external issues and a danger that the election cycle could reverse reforms and harm investment.

Emma Woollacott

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.

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The International Monetary Fund (IMF) has expressed concerns over the Greek government’s plans for a minimum wage hike and is insisting that the country cut its tax-free ceiling as of January 2020.

Managing director of the Foundation for Economic and Industrial Research (IOBE), Nikos Vettas also joined the fray, saying that increasing the minimum wage to a proposed €630 (US$723) per month was out of line with Greece’s economic and productivity growth, Ekathimerini reported.

But Labour Minister Efi Achtsioglou told Tornos News that the planned increase, along with the planned abolition of a “sub-minimum” payment level for wage-earners under the age of 25, would have an impact on 24 different subsidies and stipends related to wage scales.

She added that government-mandated increases in private sector wage scales would enhance benefits for the unemployed, college students and working mothers among others, claiming that up to 300,000 people would benefit.

Greece cut its minimum wage from E781 to E580 at the start of 2012 under pressure from the IMF, but this meant it was the only country in the European Union to have a minimum wage lower than in 2008, according to Greek Reporter. 

Meanwhile, the IMF report also warned about increased risks posed to the Greek economy by this year’s national elections, a court decision on pensions and the state of the credit system, Ekathimerini reported. It argued that such risks have recently grown more serious because, on top of the difficult legacy of the country’s financial crisis, which includes high public debt levels, the deterioration of corporate finances and payment problems, there are also external issues and a danger that the election cycle could reverse reforms and harm investment.

Emma Woollacott

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.

OTHER STORIES THAT MAY INTEREST YOU

A compliance guide to EU payroll

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Czech Republic boosts minimum wage

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