Business World

Monday 11 December 2017

Greece admits falling behind over cuts and reforms

Newly appointed Greek Finance Minister Yannis Stournaras (C), Government spokesman Symeon Kedikoglou (R) and Deputy Foreign Minister Costas Tsiaras attend a swearing-in at the presidential palace in Athens. Photo: Reuters
Newly appointed Greek Finance Minister Yannis Stournaras (C), Government spokesman Symeon Kedikoglou (R) and Deputy Foreign Minister Costas Tsiaras attend a swearing-in at the presidential palace in Athens. Photo: Reuters

Renee Maltezou and Harry Papachristou

GREECE conceded yesterday it had slipped "in some respects" in implementing the cuts and reforms demanded by lenders in exchange for saving Athens from bankruptcy, and tried to persuade them to cut the country some slack.

Finance Minister Yannis Stournaras made the admission after meeting senior officials from Greece's "troika" of lenders from the EU, European Central Bank and International Monetary Fund, whose inspectors are picking through the country's books after weeks of political paralysis.

Trying to take advantage of a shift in Europe towards more growth-friendly policy measures, the government is trying to soften the punishing terms of a bailout that is keeping Greece solvent but also driving it deeper into recession.

Conservative Prime Minister Antonis Samaras's uneasy coalition of left and right is under intense public pressure to ease the burden on a society that is fraying at the edges.

But it faces fierce resistance from sceptical European partners, led by Germany.

Stournaras, a liberal economist who was sworn in shortly before meeting the troika, said Greece's fiscal adjustment programme had been slowed by an election in May and a ballot re-run on June 17.

Off-track

"The economy has gone through two difficult elections and the programme is off track in some respects, and it is on track in others," he told reporters.

"The troika people told me, jokingly, that I'm not going to have a good time at the Eurogroup on Monday," he said, referring to his first meeting next week with fellow finance ministers of the 17-nation euro zone. "I told them I'm aware of that."

The mission from the troika is reviewing Greece's faltering progress on fiscal adjustment and reform under a €130bn bailout deal.

With the economy in its fifth year of recession and one-in-four Greek workers jobless, the government says the austerity has become intolerable.

But without the next €31.5bn euro installment of bailout funds, Greece risks running out of cash within weeks.

Challenged by an emboldened opposition committed to rejecting the bailout, Samaras has called for targeted tax cuts, a freeze on public sector layoffs, extra help for the poor and unemployed and an additional two years to cut the deficit.

In exchange, he is offering to expand and speed up the country's privatisation process.

After meeting the troika, the Harvard-educated prime minister pledged to stabilise Greek finances while fostering economic recovery. (Reuters)

Irish Independent

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