Europe is in the clear, banks will follow

A delegation from the International Monetary Fund, European Central Bank and the European Commission said last Thursday that the debt-ridden Greece is on track with the reforms required as part of the rescue package that saved it from bankruptcy, after reviewing progress in the austerity measures the government has been implementing in order to pull the country out of a financial crisis that brought it to the brink of default last month.

To secure the funds, government has taken austerity measures that aim to make its bloated public sector less wasteful and its shrinking economy more competitive. It has pledged to cut its massive budget deficit from 13.6 percent of gross domestic product in 2009 to be cut sharply to 8.7 percent by the end of this year and to 2.6 percent in 2014.

Across Europe, countries are trying to slash their deficits. Germany plans to cut 80 billion euros in spending over the next four years, while Britain is unveiling an emergency budget this week with cuts to welfare benefits and the wages of state employees.

Spain is pushing through budget cuts and labor reforms that Spanish Prime Minister Zapatero claimed would prevent new redundancies and encourage companies to hire more workers.

For more: Europe is in the clear, banks will follow - The China Post