Greece approves 2010 budget
By Derek Gatopoulos |
December 25, 2009, Friday
|
Print Edition
Print Edition
GREECE'S parliament approved a 2010 budget aimed at reducing the country's high deficit by boosting tax revenues while slashing spending and restricting salaries and new appointments in the public sector.
Following a five-day debate in parliament, and amid pressure from markets and other European Union countries, all 160 Socialist lawmakers approved the budget in yesterday's vote, while 139 from four opposition parties opposed it, and one deputy was absent.
"We can't take aspirins to deal with this problem ... We have to change course," Prime Minister George Papandreou told parliament. He blamed Greece's struggling finances largely on corruption, tax evasion and government waste.
Greece has promised to reduce the budget deficit from a projected 12.7 percent of gross domestic product in 2009 to below 9.4 percent next year, and as low as 8.7 percent if further cuts are successfully implemented.
According to figures in the budget, the national debt is set to reach 325 billion euros (US$464 billion) next year, while GDP in 2010 is estimated at 244.2 billion euros, with national output contracting 0.3 percent next year.
"There is no margin for error. The only margin there is is to improve our targets, and that is why we ... are aiming for a 4-point reduction in the deficit," Finance Minister George Papaconstantinou said.
Papandreou, whose Socialist Party won elections in October, faces an acute financial crisis that prompted three international ratings agencies to downgrade Greek bond ratings this month. He has promised to bring the deficit to below the 3 percent level required for countries that use the euro by the end of his four-year term.
Following a five-day debate in parliament, and amid pressure from markets and other European Union countries, all 160 Socialist lawmakers approved the budget in yesterday's vote, while 139 from four opposition parties opposed it, and one deputy was absent.
"We can't take aspirins to deal with this problem ... We have to change course," Prime Minister George Papandreou told parliament. He blamed Greece's struggling finances largely on corruption, tax evasion and government waste.
Greece has promised to reduce the budget deficit from a projected 12.7 percent of gross domestic product in 2009 to below 9.4 percent next year, and as low as 8.7 percent if further cuts are successfully implemented.
According to figures in the budget, the national debt is set to reach 325 billion euros (US$464 billion) next year, while GDP in 2010 is estimated at 244.2 billion euros, with national output contracting 0.3 percent next year.
"There is no margin for error. The only margin there is is to improve our targets, and that is why we ... are aiming for a 4-point reduction in the deficit," Finance Minister George Papaconstantinou said.
Papandreou, whose Socialist Party won elections in October, faces an acute financial crisis that prompted three international ratings agencies to downgrade Greek bond ratings this month. He has promised to bring the deficit to below the 3 percent level required for countries that use the euro by the end of his four-year term.
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