Stournaras expresses cautious optimism for Greece’s future

A new draft tax code which has caused government friction, the Greek bond buyback scheme and the deal reached by eurozone finance ministers in Brussels last week were among the issues addressed by Greek Finance Minister Yannis Stournaras on the New Folders news show on Skai late on Tuesday.

Speaking to the show’s host, Alexis Papachelas, Stournaras said that the country was currently developing “a bridge for our children,” referring to a string of tough measures adopted by the current administration. “This is about our generation investing for the next one,” he said.

Stournaras displayed guarded optimism with regard to Greece’s future, noting that the country will overcome the crisis and that investments will make a comeback once the “drachmaphobia” fear disappears. He said the completion of the bond buyback would help considerable in allaying fears about a euro exit.

On the subject of last week’s Eurogroup, the Finance Minister said negotiations were tough but Greece earned kudos from both friends and the country’s more distrustful partners.

Regarding the new tax bill expected to be submitted to Parliament soon, Stournaras argued that no proposal regarding a 45 percent tax rate for those earning over and above 25,000 was ever considered.

On the controversial issue regarding family allowances, Stournaras argued that the government’s aim was to adjust the Greek tax system based on those in developed countries. Social expenditure in Greece was currently above the eurozone average, he said, and income criteria would be introduced.

Stournaras reiterated that participation in the bond buyback scheme was voluntary, stressing that Greek social security funds, for instance, would not be the recipients of direct orders from the government regarding their own participation.

The Finance Minister also spoke about the dramatic mood that prevailed in the recent Eurogroup meeting, noting that in his own address to his eurozone counterparts he argued that failure to strike a deal would have resulted in Greece not belonging to the West in the near future, as the country would have to borrow money from other sources.

Asked whether additional austerity measures should be expected in 2013, Stournaras said those taken so far were adequate, arguing that the country could achieve a primary surplus within the next year and possibly ease up on costcutting measures in 2014.

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