ECONOMY

Economy the strong card?

The positive results of the government’s economic policy in its current term are its strongest card for the early elections called yesterday for September 16, Economy and Finance Minister Giorgos Alogoskoufis said. «The doom predicted by the opposition proved to be out of time and place. The reforms are bearing fruit,» he said after the prime minister’s announcement. He said the continuation of reforms to the economy and social services was at stake in this election. «The government to date has applied a consistent policy for dealing with the great problems created by the governments of yesterday. The bolstering of growth, employment and social cohesion are the government’s basic targets,» Alogoskoufis said. Among the prime results was the lowering of the fiscal deficit from 7.9 percent of gross domestic product (GDP) in 2004 to 2.6 percent in 2006. The growth rate of the economy accelerated to 4.3 percent in 2006 and 4.4 percent in the first half of 2007 – among the highest in the eurozone. «The Greek economy has maintained its growth momentum under conditions of fiscal adjustment, contrary to fears that had been expressed of a slowdown or recession after the Olympic Games and in spite of the impact of adverse external factors, such as high oil prices.» Social policy He said economic policy had been well planned, with changes in taxation, incentives for investors and public-private partnerships for public infrastructure. Unemployment fell from 11.3 percent in March 2004 to 7.7 percent last May, thanks to mainly private investment which created more than 200,000 new jobs. Alogoskoufis said that despite the stringent fiscal conditions, the government did meet its commitments regarding support to the least well-off, through increases in benefits, pensions and the tax-free ceiling. «We are implementing our commitments and undertaking new ones, mainly targeting a stronger welfare state and the continuation of fiscal rehabilitation,» he said. Alogoskoufis added that the program for the next four years includes setting up the National Social Cohesion Fund and the introduction of a national minimum pension.