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Economy

No Help from EU, Greece Goes Alone with More Energy Subsidies

ATHENS – Prime Minister Kyriakos Mitsotakis’ government will keep pumping subsidies for Greek households and consumers overwhelmed by soaring electric bills after the European Union ignored his plea for a bloc-wide policy helping its 27 member states.

With elections coming in 2023 – if not sooner – his New Democracy government is keen to keep helping despite the costs on top of previous aid over the lingering COVID-19 pandemic.

Russia’s invasion of Ukraine has further roiled world markets in everything from food to fuel and spiked prices, hurting households and businesses who pass on the costs, seeing more people spending less now instead.

The government, said Kathimerini in a report, thinks it’s likely the problem will last through 2022 and other EU countries, particularly Germany and France, don’t want more subsidies being spread out as they deal with their own problems.

A smaller-than-expected deficit and better-than-expected revenue in the first quarter of 2022 is making enough funds available for now, the report said, as the government doesn’t want to borrow more and add to debt that includes the majority of what’s left of 326 billion euros ($348.01 billion) in three international bailouts.

This time, intervention in the energy market will not take the form of subsidies of electricity consumption but rather a cap on wholesale energy prices and a likely reduction of the 24 percent Value Added Tax (VAT) on food, including bread and milk.

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