Saturday December 20, 2014 Search
Weather | Athens
17o C
10o 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)  
Workers rush to get early retirement
Piraeus Containter Terminal goes from strength to strength
Moscovici: Creditor inspections to become less frequent and ‘lighter’
Property capital gains tax halt
Environment Ministry to reconsider controversial bill
The government over the weekend appeared to backpedal on proposed amendments widely seen as compromising legislation protecting Greek forests as well as Plaka, Athens’s old quarter. The bill...
Corfu to host country’s first hydroplane strip
Merchant Marine Minister Miltiades Varvitsiotis and Deputy Infrastructure and Transport Minister Michalis Papadopoulos have signed a decision paving the way for the country’s first hydroplan...
Inside News
BASKETBALL
Explosive Barca unfazed by Panathinaikos, bomb scare
Panathinaikos lost 80-67 at home to Barcelona on Friday in a rather meaningless game at the end of the first group stage of the Euroleague, but the encounter will be remembered for the bomb ...
SOCCER
Abidal cuts short playing career at Olympiakos
Former France and Barcelona defender Eric Abidal announced his retirement from football on Friday, a day before his last match. Abidal said he will finish after playing for Olympiakos agains...
Inside Sports
COMMENTARY
The big picture
In his second term, US President Barack Obama is taking steps to enshrine his legacy and solidify America’s standing in the 21st century. His recent decision to normalize relations between t...
EDITORIAL
Get your facts straight
The danger that political discourse in Greece will sink to the basest levels of vulgarity is already more than apparent from the allegations we have heard bandied about over recent days. The...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Environment Ministry to reconsider controversial bill
2. Corfu to host country’s first hydroplane strip
3. Political upheaval sharpens after bribe claims with threats and insinuations
4. Police gets new communications system
5. Most Greeks say they recycle daily
6. Probe into revenues of 2 mln euros in Halkidiki municipality
more news
Today
This Week
1. The big picture
2. Get your facts straight
3. Political upheaval sharpens after bribe claims with threats and insinuations
4. Environment Ministry to reconsider controversial bill
5. Changes on E9 property declarations possible until end-year
6. Police gets new communications system
Today
This Week
1. Juncker warns Greeks against voting 'extreme forces' into power
2. Romanos and the dilemma
3. Samaras summons bond vigilantes with euro exit talk
4. A friendly yet firm message from Pierre Moscovici
5. Europe's drama in Greece needs final act to avoid tragedy
6. High stakes
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.