Netherlands to Grudgingly Accept Third Greek Bailout

The Dutch are doubtful Greece will honor its commitments this time around.

Dutch prime minister Mark Rutte makes a speech in parliament in The Hague, November 13, 2012
Dutch prime minister Mark Rutte makes a speech in parliament in The Hague, November 13, 2012 (Rijksoverheid)

The Dutch parliament is expected to approve Greece’s third bailout on Wednesday, despite popular and political opposition to the €86 billion rescue package.

Polls show almost one in two Dutch voters opposes the bailout, but mainstream parties are unlikely to join the Euroskeptic Freedom Party in voting to oust the government.

As Europe’s sixth largest economy, the Netherlands is expected to contribute €5 billion to the latest rescue effort, which comes on top of €240 billion in support provided by the European Union and the International Monetary Fund since 2010.

Broken promise

Prime Minister Mark Rutte would be breaking a 2012 election promise not to support any more bailouts.

His parliamentary liberal party said on Tuesday it would after all vote in favor of the rescue plan which commits Greece to far-reaching economic reforms, including higher sales taxes, pension cuts, a liberalization of the labor market and privatizations.

The liberals previously expressed doubts, but Mark Harbers, the party’s financial spokesman, explained that they feared the Netherlands would be isolated in Europe if it voted against the bailout.

“It’s Greece that should be isolated,” he told reporters.

Skepticism

While Greece’s previous bailouts were also conditioned on economic reforms, the country failed to implement measures its creditors deemed necessary to boost competitiveness and prevent another debt crisis in the future.

The Dutch, who took a hard line in negotiations for the third bailout package, are skeptical the Greeks will honor their commitments this time.

Freedom Party leader Geert Wilders has accused Rutte of “breaking the trust of the Dutch people”.

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