Competitiveness and growth

The Greek economy is seeking a way forward through growth and the private sector must be a major contributor to its resurgence, Economy and Finance Minister Giorgos Alogoskoufis said yesterday. Speaking during a press conference, Alogoskoufis said the EU Council of Economy and Finance Ministers (Ecofin) has given Greece a timetable to rectify its finances, which must be achieved along with bolstering its competitiveness and pushing the economy to be more outward-looking. He said in mid-March Greece will table in Parliament and forward to the EU its updated Stability and Growth program. This will include three scenaria: The first has the 2005 budget completed as planned. The second is based on EU assessments foreseeing a deficit of 3.6 percent of gross domestic product. The third, and most negative, takes into account the possible impact from unforeseeable events. In all cases, the deficit must, by the end of 2006, stand below the 3 percent limit of GDP, Alogoskoufis stressed. Regaining fiscal balance is vital but not enough to secure growth. «It is very important that competitiveness and extroversion are strengthened through structural reforms, the use of the [EU-subsidized] Community Support Framework and promoting the targets set in the Lisbon agenda [to be attained by 2010]. The government has taken significant initiatives to this end, but there is still much to be done, while an important condition is the private sector’s response,» he said. Expanding on current policy, the minister noted that «the strategy of mild adjustment was adopted to prevent a crash for the Greek economy after the Olympics and the creation of social problems.» This is reflected in the 2005 budget, Alogoskoufis said, suggesting that Ecofin supported this choice. Regaining fiscal balance and dealing with high public debt, he underlined, are essential to strong economic development, a rise in employment and the strengthening of social cohesion. It is a central objective of the economic policy and, despite its hard points, the result will be positive, he said, for Greece to make the most of its membership in the Economic and Monetary Union. The minister will also ask the heads of public companies, in meetings over the next few days, to achieve proper management and resource savings. He remarked that the state must monitor carefully all public companies funded by taxpayers. Finally, Alogoskoufis said that after his meeting with Regional Policy Commissioner Danuta Hubner, there will be a final settlement of the issue of EU resources that Greece is under threat of losing.

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