Thursday November 27, 2014 Search
Weather | Athens
12o C
9o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Greece talks up progress, sidesteps debt write-off issue

By Luke Baker

Greek ministers delivered a staunch defense of their efforts to put the economy back on track on Wednesday and said they did not want any more conditional loans from the EU or IMF, although leeway would be helpful.

Meeting Brussels-based journalists on a visit to Athens as Greece takes over the presidency of the EU, Foreign Minister Evangelos Venizelos and Finance Minister Yannis Stournaras emphasized early signs of economic recovery while treading carefully around the issue of debt relief or renegotiation.

"No other country during peacetime has achieved as much as Greece has achieved since 2009, Stournaras said when asked what specific steps he had taken to overhaul the economy and make it competitive again after six years of debilitating recession.

"People should this year begin to feel the impact in their pockets and in their everyday lives."

Asked repeatedly if it was not essential for Greece to write off or renegotiate some portion of the 240 billion euros ($327 billion) loaned by the European Union and International Monetary Fund if it was to have any chance at a sustained recovery, both Venizelos and Stournaras demurred.

Venizelos, a combative former finance minister and Socialist party leader, said Greece had made no request for a haircut or reduction in the value of its loans and was only interested in how to make the outstanding pile more manageable.

"We want a serious technical discussion about how to make the debt sustainable in the long term, he said, adding that to this point none of the loans had cost European taxpayers a cent because all obligations had been paid in full.

Instead, Stournaras said there was room to lower the interest rates on the loans still further - even though they are barely above the cost of financing - as well as making changes to the pay-back schedule and using EU development funds in more imaginative ways to keep Greece solvent and on a recovery path.

"A reduction in the interest rate and a pushing back of the amortization schedule is more effective from the point of view of the financial markets, he said, dismissing suggestions that what Greece ultimately needed was debt relief.

He also sidestepped the possibility of a further loan from the EU and IMF, despite growing expectations that it will be necessary, with discussions possible later this year.

Any new loan would likely come with further strict conditions on spending cuts and tax increases that Greece is determined to avoid, not least to avert further social unrest.

"There can be no more fiscal conditionality, the finance minister said, highlighting the dire impact earlier rounds of spending cuts, state salary reductions and tax increases had had on the economy and domestic spending.

"It's quite illogical to impose any more conditionality. It's totally self-defeating at this stage."

Over the past four years, Greece has forced through a 22 percent reduction in the minimum wage, cut average public sector salaries by nearly a quarter and slashed some pensions by more than 40 percent, delivering a deep internal devaluation.

While the economy has contracted by almost 25 percent from its peak, following six consecutive years of recession, the current account deficit has been erased, exports have begun to pick up and growth of 0.6 percent is scheduled this year. Unemployment has stabilized, albeit at a painful 27 percent.

Stournaras did not rule out a request for further loans, but said any borrowing would have to come without strict fiscal conditions, which Venizelos blamed squarely on the IMF.

In a sign of increased confidence, especially with Ireland this week successfully returning to the financial markets, Stournaras said it was likely Athens would test the waters with a 5-year bond issue in the second half of 2014, after a roadshow for international investors.

While this would mark a significant step forwards, it would still fall a long way short of full market access - and socially and politically Greece remains deeply troubled.

Police and paramilitary units spread out across central Athens on Wednesday to prevent demonstrations before the arrival later in the day of the European Commission President Jose Manuel Barroso and other EU officials.

And Prime Minister Antonis Samaras's coalition government is barely holding on to a three-seat majority in parliament. He dropped plans to increase healthcare costs this week and will raise taxes on cigarettes instead, largely to avoid the threat of a parliamentary revolt.

Samaras rescinded a 25-euro hospital fee to be paid by patients as of January 1 after his coalition partner Venizelos came out against it, an effort to burnish the socialist credentials of his beleaguered PASOK party.

PASOK, once seen as Greece's natural ruling party, has paid the biggest political price of austerity, seeing its support plummet from 44 percent in 2009 elections to single-digit figures in latest opinion polls.

[Reuters]

ekathimerini.com , Wednesday Jan 8, 2014 (15:47)  
Debtors snap up offer for easier settlements
Belgium gas firm said to be eyeing DESFA
OLP approval paves way for investment in Piraeus
Airport tender exceeds expectations
Hundreds of migrants on crippled ship off Crete
Ships from Greece rushed to help after a crippled freighter crammed with hundreds of migrants floundered for hours Tuesday in gale-force winds and high waves in the Mediterranean Sea, offici...
Policemen suspected of working at Piraeus bar where shooting took place
At least three serving policemen are thought to have been working at the bar in Mikrolimano, Piraeus, where a 31-year-old man opened fire with an AK-47 early on Saturday, resulting in 15 peo...
Inside News
SOCCER
Atletico eyes last 16 berth against Olympiakos
Greek champion Olympiakos faces a tough task if it is to prevent last season's beaten finalist Atletico Madrid sealing its passage into the last 16 of the Champions League at the Vicente Cal...
SOCCER
EPO ends soccer suspension, Super League resumes
Soccer action will resume this weekend after the Super League convened on Monday, elected a new president and alternate president and sent a letter to the soccer federation that assures it t...
Inside Sports
COMMENTARY
Beware of the fallen idols
Akis Tsochatzopoulos, a legendary figure of the Greek socialist movement, a man who came very close to taking over the party that governed the country for half of the time following the fall...
EDITORIAL
The hard truth
The coalition government must tell the truth to the Greek people, even if this entails admitting to mistakes made over the last few months. The countrys citizens are fully aware of how cruc...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
RECENT NEWS
1. Hundreds of migrants on crippled ship off Crete
2. Atletico eyes last 16 berth against Olympiakos
3. Debtors snap up offer for easier settlements
4. Belgium gas firm said to be eyeing DESFA
5. OLP approval paves way for investment in Piraeus
6. Airport tender exceeds expectations
more news
Today
This Week
1. Anastasiades to undergo heart surgery in the US on Dec 4
2. Two police officers among 9 arrested for drug trafficking
3. Cargo vessel carrying hundreds of migrants adrift southeast of Crete
4. Trade deficit widens by 8.7 percent during Jan-Sept period, says ELSTAT report
5. Fraport, Copelouzos offer highest bid for Greek regional airports
6. Stop Mediterranean becoming vast migrant cemetery, Pope tells Europe
Today
This Week
1. Give Greece a chance
2. Biden heads to Istanbul amid tension over Cyprus EEZ violation
3. Scientists expand excavation of ancient Amphipolis
4. Extremism from a bygone era
5. Piraeus nightclub shooting leaves 3 seriously injured
6. Coscos Greek unit adds multinational rail-freight client
Find us ...
... on
Twitter
... on Facebook
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright 2014, H KAΘHMEPINH All Rights Reserved.