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ECONOMICS REPORT - After Elections, Greece May Renegotiate Loans

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Greece's Prime Minister Alexis Tsipras, second right, and Deputy Prime Minister Giannis Dragasakis chat during the first cabinet meeting of the new government at the Parliament in Athens, on Wednesday, Jan. 28, 2015. (AP Photo/Petros Giannakouris)
Greece's Prime Minister Alexis Tsipras, second right, and Deputy Prime Minister Giannis Dragasakis chat during the first cabinet meeting of the new government at the Parliament in Athens, on Wednesday, Jan. 28, 2015. (AP Photo/Petros Giannakouris)

From VOA Learning English, this is the Economics Report.

Elections in Greece on Sunday put politician Alexis Tsipras and his Syriza party in power in the heavily indebted country. Prime Minister Tsipras gained popularity by promising to end austerity policies. Those are measures to shrink the government budget and reduce spending.

Mr. Tsipras has said he will renegotiate the terms of loans from the European Union and International Monetary Fund. They offered Greece $268 billion in assistance in 2010 and 2011 to help prevent a financial disaster in the country.

E.U. finance ministers have suggested giving Greece, an EU member, more time to pay back its loans. However, there is little support for cancelling any of the debt.

Dionyssis Dimitrakopoulos is a political expert at the University of London. He says E.U. members know that they are not getting the results they wanted from Greece's austerity program.

"Institutions of the E.U. and other member states realize that the program that has been implemented in Greece is not producing the desired results to the extent that they wanted. So something has to change. In my book this is common ground for negotiation."

Mr. Tsipras has tried to show that he means to change Greek politics. For example, he did not include a religious act at his swearing-in ceremony. Greek Orthodox officials traditionally give a blessing.

The new leader's Syriza party joined with the right-wing Independent Greeks Party to form a ruling coalition in parliament. Both parties want to change the terms of Greece's loan deal. But, they agree on little else.

E.U. Commission President Jean-Claude Juncker told reporters that EU officials would have to look at the demands of the new Greek government. But, he also said that the E.U. rules were established through a common agreement with Greek officials.

Germany, Europe's largest economy, is considered the strongest supporter of austerity measures. Government officials have stated that it may be better for Greece to stop using the euro as its currency.

However, expert Dionyssis Dimitrakopoulos says the cost of Greece leaving the euro zone may be too high.

"It is in nobody's interests, and that concerns not only Greece but also Germany, France and so on, for Greece to withdraw from the eurozone. Because the next question will be, 'who will be the next country to withdraw?'"

Whether Greece will stay in the Eurozone is not the only question E.U. officials might face. British Prime Minister David Cameron has said he would seek to renegotiate Britain's relationship with the E.U. if his Conservative Party wins elections in May.

And that's the Economics Report from VOA Learning English. I'm Mario Ritter.

Mario Ritter wrote this story for VOA Learning English from reports by correspondents Henry Ridgewell and Lisa Bryant. Caty Weaver was the editor.

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Words in This Story

austerity n. measures taken to cut expenses where money is spent only on necessary things

renegotiate v. to again discuss details of a formal agreement especially in order to change them

coalition n. a group of people, groups or countries who have joined together for a common purpose

euro zone n. the group of European countries that share the euro as their common currency

What are your thoughts about austerity, an important word in our story? Share them with us in the comments section below.

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