Home / World Business
Tue, Sep 14, 2010 - Page 10 News List

Greek PM declares no new austerity measures planned

MORE CONFRONTATION Another round of open-ended strikes by truckers was to have begun yesterday, although a government order to commandeer trucks was still in place


The Greek government is planning no new austerity measures as part of efforts to pull the country out of debt and might even exit international supervision earlier than expected, Greek Prime Minister George Papandreou said on Sunday.

Papandreou said Greece was on track to meet targets for reducing its deficit by nearly 40 percent this year.

“We will not need any new measures,” he said during a news conference a day after making his annual speech on the economy on the sidelines of a trade fair in northern Greece.

Papandreou also reiterated that Athens did not plan to restructure its debt — a move that he said would have been “catastrophic.”

In exchange for 110 billion euros (US$140 billion) in rescue loans over three years from the IMF and some EU countries, Greece has implemented strict fiscal control, seeking to reduce the budget deficit from a stunning 13.6 percent of annual output last year to 8.1 percent this year.

The tough austerity measures, which included salary cuts and tax hikes, angered labor unions, which have staged six general strikes this year and organized protests in Thessaloniki on Saturday, while a new round of confrontation starts this week.

On the eve of an open-ended truckers’ strike, which is set to stifle deliveries of fuel and goods, long lines formed at Greek gasoline stations on Sunday, while many pumps ran dry.

In the summer, a seven-day truckers’ strike caused severe shortages throughout the country and only ended when the ­government commandeered strikers’ vehicles.

Truckers also say they were to drive their vehicles to parliament in Athens in protest yesterday. However, it was unclear whether authorities would allow the strike to go ahead, as the order to commandeer trucks still stands.

Haulers fiercely oppose plans to open their profession — together with notaries, taxi drivers, architects and chemists — to non-union members, arguing that the move would destroy their future prospects.

State railway unions also called a 24-hour strike today to protest planned salary and personnel cuts as part of efforts to reform and partially privatize the money-losing rail network.

Papandreou pledged on Sunday that successful implementation of his reform program would ease pain across Greek society.

“The faster we proceed with our reforms, the sooner ... we will be able to restore and increase salaries and pensions,” he said. “And that is our target.”

Asked whether Greece might ask for an extension of the EU-IMF package beyond its 2013 end date, Papandreou said the government did not intend to ask for an extension, and could even leave the program early if good progress was made.

The year 2013 “is truly the end of this process,” Papandreou said. “The faster we complete the major reforms in our country … the sooner we will be able to exit these restrictions. That could even happen before 2013, provided we do well.”

The government’s main challenge now is to boost revenue, which is lagging behind targets, although the shortfall is offset by better than expected performance in spending cuts.

The Greek Finance Ministry says net revenue increased 3.3 percent in the first eight months of this year, against a target of 13.7 percent for this year.

However, spending fell by 12 percent from January to last month, compared with an end-year target of 5.8 percent.

This story has been viewed 1731 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top