Thursday October 30, 2014 Search
Weather | Athens
19o C
12o 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 Fund’s 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, yesterday’s 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 country’s 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)  
European stocks tumble as banks decline after Enria’s comments
Germany’s bonds rise as consumer prices decline in six states
Peripheral banks lead European shares lower after positive start
Greek euro dilemma is back as minister predicts volatility
Tsipras to meet with BoG governor on Thursday
SYRIZA chief Alexis Tsipras was expected to meet with Bank of Greece Yannis Stournaras on Thursday. According to sources the meeting had been originally scheduled for Friday, but was nearly ...
Over 1,500 buildings and vehicles damaged in flash floods
Applications for compensation following heavy showers last Friday had reached 1,085 for homes and businesses and 422 for vehicles by Thursday, while 395 people had filed for emergency compen...
Inside News
BASKETBALL
Panathinaikos and PAOK retain perfect record
The third round of games in the Basket League over the weekend saw PAOK overcome the strong resistance of host KAOD at Drama, and Panathinaikos and Olympiakos inflict heavy losses on AEK and...
SOCCER
Gattuso recalls resignation from OFI bench
Gennaro Gattuso has recalled his resignation from the OFI Crete bench following pressure by the club’s fans and administration, one day after his quitting accusing the club and its players o...
Inside Sports
COMMENTARY
Time is running out in Afghanistan
Thirteen years after the attacks on the Twin Towers and NATO's entry into the war in Afghanistan, things remain pretty much unchanged: Political instability and insecurity  reign in the Cent...
COMMENTARY
Cool heads required
It’s time for Athens and Nicosia to deal with the current situation in Cyprus’s Exclusive Economic Zone (EEZ), which a Turkish seismic research vessel has breached against international law,...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. European stocks tumble as banks decline after Enria’s comments
2. Tsipras to meet with BoG governor on Thursday
3. Germany’s bonds rise as consumer prices decline in six states
4. Over 1,500 buildings and vehicles damaged in flash floods
5. Clientelism belongs to the past, says Mitsotakis
6. Peripheral banks lead European shares lower after positive start
more news
Today
This Week
1. Greek euro dilemma is back as minister predicts volatility
2. Students hijack university senate meeting
3. Peripheral banks lead European shares lower after positive start
4. Clientelism belongs to the past, says Mitsotakis
5. Over 1,500 buildings and vehicles damaged in flash floods
6. Germany’s bonds rise as consumer prices decline in six states
Today
This Week
1. At least 11 banks to fail European stress tests, three in Greece, report says
2. Austria’s creative bookkeeping beats Greece on secret debts
3. Cyprus to block Turkey's EU talks after EEZ violation
4. End of reason, end of humanity
5. Clean bill of health for Greek banks from stress tests
6. Samaras pledges action after flash floods in Athens
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.