Tuesday September 2, 2014 Search
Weather | Athens
29o C
23o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
IMF sees deficit over 7 pct in 2012

 Report calls for spending cuts of at least 15 bln euros by 2017

By Sotiris Nikas

The budget deficit this year will be greater than the Greek government has forecast, according to a report published on Tuesday by the International Monetary Fund, which also stresses the need for additional spending cuts of at least 15 billion euros (7.7 percent of gross domestic product) between now and 2017.

The IMF expects the deficit to end the year at 7.2 percent of GDP, up from a forecast for 6.7 percent as seen in the supplementary budget passed by the government in February. The Washington-based Fundís report that accompanied the new memorandum Athens signed with its creditors in March had forecast a deficit of 7.3 percent.

The new government to emerge from the May 6 elections will have to decide on measures amounting to 11.6 billion euros for 2013 and 2014. However, yesterdayís report seems to suggest that the fiscal adjustment will continue well beyond 2014 and will have to rely almost exclusively on spending containment: From 48.9 percent of GDP, spending will have to go down to 41.2 percent of GDP by end-2017.

Cutting expenditure seems to be the only way for Greece to improve its finances as general government revenues will continue to drop as a GDP ratio for the coming years: GDP is expected to grow after 2013, but the revenues will remain the same, sending their ratio to GDP lower. Therefore, in order for Greece to obtain primary budget surpluses, it will have to rein in spending.

All this will have to happen in a financial environment that will take long to recover, as the IMF is now expecting zero growth for 2013 and a 19.4 percent unemployment rate for this year and next.

The report further sees the countryís public debt dropping to 136.8 percent of GDP in 2017, from 153.2 percent this year and 160.9 percent in 2013, when its gradual decline will begin.

The recession will continue this year at the economy-stifling rate of 4.7 percent, with the only good news being that the IMF is expecting deflation of 0.5 percent this year and 0.3 percent in 2013, meaning retail prices will go down for two consecutive years.

ekathimerini.com , Tuesday April 17, 2012 (23:06)  
Tourism targets rise ever higher
Horse race betting hurdle removed for OPAP
Revised GDP data confirm that Greek growth is near
Measures to reduce unemployment
Education minister calls for probe into predecessorīs reform plan
Following reports that a plan to reform the tertiary education sector launched in the spring of 2013 failed to lead to millions of euros in savings, Education Minister Andreas Loverdos on Mo...
Anti-racism bill goes back to Parliament
An anti-racism bill, foreseeing stiffer penalties for individuals and political parties that engage in racism or incite racist violence, is to be debated in Parliament on Tuesday following m...
Inside News
BASKETBALL
Greek hoopsters go top of their group in World Cup
Greece has qualified to the second round of the FIBA World Cup after going top of its group of six through a third win in as many group games in Spain. On Monday it beat Puerto Rico 90-79 in...
SOCCER
Fulham striker Mitroglou set to re-join Olympiakos
Greek champions Olympiakos Piraeus are set to re-sign Kostas Mitroglou on loan from English second tier club Fulham after the striker arrived in Athens for talks on Sunday. An Olympiakos spo...
Inside Sports
ANALYSIS
EUís three big problems all linked
The outgoing president of the European Council, Herman Van Rompuy, said at the weekend that his successor, Donald Tusk, currently Polandís prime minister, faces three big challenges: the sta...
COMMENTARY
A great president
I fully understand the countryís need for political stability, a necessity which makes the election of a president by the current Parliament absolutely imperative. At the same time, however,...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
†RECENT NEWS
1. Greek hoopsters go top of their group in World Cup
2. Tourism targets rise ever higher
3. Horse race betting hurdle removed for OPAP
4. Revised GDP data confirm that Greek growth is near
5. Measures to reduce unemployment
6. Peachy export data despite Russian embargo
more news
Today
This Week
1. Excavation work at Amphipolis reveals section of marble mosaic floor
2. A great president
3. Erdogan visits Turkish-occupied Cyprus
4. Greek economy shrinks at slowest pace since late 2008
5. Donít feed the zombies
6. Greek officials meet to fine tune strategy for Paris talks with troika
Today
This Week
1. Thessaloniki mayor Boutaris sworn in wearing yellow star amid Golden Dawn protests
2. The battle against progress
3. Attack on gay couple in Athens leaves one man needing surgery
4. Strong undersea quake occurs off island of Milos, felt in Athens
5. Greek quest for debt relief faces hurdles in Paris
6. Hardouvelis, ECB executive discuss bank program, stress tests
†††Find us ...
††... on
Twitter
†† ††... on Facebook ††
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.