OECD praises reforms in Greece

Organization says the effort must continue in sectors such as competition, education, employment By Sotiris Nikas

Greece is a champion in terms of reforms, but still has a long way to go, a report by the Organization for Economic Cooperation and Development (OECD) suggested on Friday.

The respected organization has found that Greece was the country with the greatest rate of reform promotion for the 2011-12 period among its member states, implementing some of the “toughest” structural changes.

“The rate of reforms was particularly high among eurozone countries either through the financial support programs or due to direct market pressures (e.g. Greece, Ireland, Spain, Italy and Portugal), even in politically sensitive sectors such as labor regulations and welfare systems,” the report read. It added that significant fiscal adjustment programs are undergoing implementation in these countries, unlike other states with higher living standards (such as Switzerland, the US and Norway) where the reform rate has been much slower.

Despite Greece having secured this distinction, the OECD believes that the reform work will have to continue, and goes on to make specific proposals regarding certain domains. It notes that the government’s priorities should be the following:

Strengthening competition, as according to the OECD there can be no further delays in the opening up of closed-shop professions and all obstacles to the liberalization of the electrical energy market should be lifted.

Tax evasion remains extensive in Greece, so system reform constitutes an urgent need. A more transparent system for taxing the self-employed and the strengthening of the tax collection mechanism are also needed.

Weaknesses in the education system are causing problems in increasing productivity, so teaching staff will have to match market developments, and university work must be put under assessment.

Unemployment benefits should turn into employment vouchers.

Cooperation between services within ministries, as well as between the ministries themselves, must be enhanced, while adopting a system of assessment for the performance of civil servants.