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Friday 29 August 2014

Greece forecasts growth at last

Published 07/10/2013 | 10:41

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Debt-stricken Greece has submitted its draft budget to parliament

Greece expects its economy to grow next year, the first annual improvement after six years of brutal contraction.

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Deputy finance minister Christos Staikouras said the economy is projected to expand 0.6%, compared with a 4% contraction this year.

Greece's economy has shrunk by about a quarter since 2008, when it was hurt by the global financial crisis. Then in late 2009, it was hit by revelations that its debt was far higher than expected.

The country has avoided bankruptcy through international rescue loans, in exchange for implementing harsh spending cuts and tax increases.

The conservative-led government has been able to reduce the budget deficit to 2.4% of output this year. According to the draft budget the deficit will remain at the same percentage in 2014.

Greece has been dependent on rescue loans from other European Union countries and the International Monetary Fund since 2010. In return, its economy has been put under strict supervision by the IMF, European Central Bank and European Commission, known as the "troika".

Successive governments have introduced repeated rounds of austerity measures to reform the country's finances and meet targets set for its budget deficit and state debt.

The government is still negotiating details of the 2014 budget with the troika, and a final draft is expected to be submitted by November.

AP

Press Association

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