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Greece keeps surplus plan
Source: Agencies |
September 20, 2011, Tuesday
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GREECE'S finance minister promised yesterday to stick with his plan for the country to post a primary surplus in 2012 as the country's international creditors pressed for faster reforms and public sector staff cuts.
Evangelos Venizelos was to take part in an emergency teleconference with debt inspectors that could go a long way to determining whether Greece avoids defaulting on its debts.
Ahead of the discussions, he said the target of generating more revenues next year than the country spends, before paying off interest on debts, remains despite the ongoing recession in the crisis-hit country.
Greece's economy is expected to contract by about 5.5 percent this year and to shrink a further 2.5 percent in 2012, according to government and IMF estimates.
Speaking at a conference south of Athens, Venizelos said the 2012 target was vital for Greece to avoid international "blackmail and humiliation" and came as markets continued to fret about the possibility of an imminent Greek default.
"We are living through a recession that is unprecedented in recent decades. The recession ... will reach 5.5 percent in (2011). It is the third straight year of recession and it will continue for a fourth, though significantly reduced," Venizelos said.
He said Greece planned to record a 3 billion euro (US$4.1 billion) primary surplus in 2012. That compares with a primary deficit of 24 billion euros in 2009.
"It is not rational or responsible to continue to increase the debt when our partners are helping us deal with the national debt," Venizelos said.
The Socialist government must live up to its commitment to lower the 2011 budget deficit goal to 7.6 percent of gross domestic product.
When it became obvious earlier this month that there was a more than 2 billion euro shortfall in the budget, Greece's creditors threatened to withhold the sixth installment of a 110 billion euro rescue package agreed in May 2010.
Without the installment, worth 8 billion euros, Greece faces defaulting on its debts by mid-October.
Evangelos Venizelos was to take part in an emergency teleconference with debt inspectors that could go a long way to determining whether Greece avoids defaulting on its debts.
Ahead of the discussions, he said the target of generating more revenues next year than the country spends, before paying off interest on debts, remains despite the ongoing recession in the crisis-hit country.
Greece's economy is expected to contract by about 5.5 percent this year and to shrink a further 2.5 percent in 2012, according to government and IMF estimates.
Speaking at a conference south of Athens, Venizelos said the 2012 target was vital for Greece to avoid international "blackmail and humiliation" and came as markets continued to fret about the possibility of an imminent Greek default.
"We are living through a recession that is unprecedented in recent decades. The recession ... will reach 5.5 percent in (2011). It is the third straight year of recession and it will continue for a fourth, though significantly reduced," Venizelos said.
He said Greece planned to record a 3 billion euro (US$4.1 billion) primary surplus in 2012. That compares with a primary deficit of 24 billion euros in 2009.
"It is not rational or responsible to continue to increase the debt when our partners are helping us deal with the national debt," Venizelos said.
The Socialist government must live up to its commitment to lower the 2011 budget deficit goal to 7.6 percent of gross domestic product.
When it became obvious earlier this month that there was a more than 2 billion euro shortfall in the budget, Greece's creditors threatened to withhold the sixth installment of a 110 billion euro rescue package agreed in May 2010.
Without the installment, worth 8 billion euros, Greece faces defaulting on its debts by mid-October.
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