ECONOMY

Task force for Greece outlines scope

The European Union?s task force for Greece, which will provide technical assistance in the implementation of reforms over the next two years, embarked on contacts with the government in Athens on Wednesday, as ministers are preparing for a new round of deliberations with the representatives of the country?s international creditors, the so-called troika.

Horst Reichenbach, head of the task force, who met Prime Minister George Papandreou and Deputy Prime Minister Theodoros Pangalos, described the breadth and depth of structural reforms which Greece has to implement as ?unique.?

?I cannot make estimates whether there is a plan B, I am here to implement plan A,? he said at a conference, insisting that his role is not to act as a substitute for the Greek government.

Reichenbach said his 25-member team?s goal was to help in speeding up the absorption of European Union investment subsidies (NSRF), with a view to an improvement in the entrepreneurial climate and employment, and the facilitation of enterprises? access to liquidity.

Two-thirds of the task force will be based in Brussels and the rest in Athens.

Speaking at the same conference, ?Recovery Now — A Herculean Task for Greece,? Development Minister Michalis Chrysochoidis said the aim of speeding up NSRF projects was to activate funds totaling 7.7 billion euros for productive uses. He insisted on the need to improve the means of providing operating capital to small and medium-size enterprises, reiterating the government?s intention to create an investment bank modeled on Germany?s KfW.

Meanwhile, the troika is reported to be pressing for further cuts in tax allowances, salaries and other items of public spending, with a view to raising a further 6 billion euros this year and in 2012. Four billion will be raised from measures such as the new property tax which was announced on Sunday, and a further 2 billion from cuts in public employees? salaries and tax allowances.

Delays in the implementation of the integrated pay structure in the public sector, which had been scheduled for July 1, the loose application of guidelines for limits to new hirings and overtime, and a continued drain of payments to bankrupt local government entities are seen as responsible for public spending rising to 47.8 billion euros in the January-August period from 43.5 billion in the same period of 2010.