Austere Greek budget

In a keynote speech to parliament after the Finance Ministry presented the 2016 draft budget, Greek Prime Minister Alexis Tsipras on Monday implored that debt relief was "essential" in order for Greece to return to growth and regain access to bond markets.

Tsipras promised to be a firm negotiator when it came to convincing creditors to extend Greece's loan maturities or lower its interest rates. For their part, the finance ministers of other eurozone member states have agreed to discuss limited debt restructuring but have ruled out a writedown.

The draft budget foresees the Greek economy contracting by 2.3 percent by the end of this year. In 2016, the year the government's debt-to-GDP ratio will peak at 197.7 percent, the economy will shrink by 1.3 percent. The country won't return to growth until 2017.

According to the budget, after a 0.24 percent primary deficit this year, Greece will have a primary fiscal surplus before debt service costs of 0.5 percent of GDP next year.

In his speech, Tsipras said one of his administration's highest priorities was successfully completing an initial bailout review so that it might unlock some money from its latest 86 billion-euro ($96.2-billion) bailout.

Failing to hold up its end of that bailout deal, which imposed 6.4 billion euros worth of austerity measures this year and next, of which 4.34 billion will fall in 2016, would push the indebted country back to the brink of default and an exit from the eurozone.

cjc/hg (Reuters, dpa)