ECONOMY

Minister blames failed measures

Finance Minister Giorgos Papaconstantinou blamed the failed measures of the previous government for the large budget deficit and promised in a letter to EU Economic and Monetary Affairs Commissioner Joaquin Almunia to restore the credibility of Greek statistical data. Although the Greek minister had no obligation to update the European Union commissioner, Papaconstantinou chose to inform him of the measures Greece has taken this year that will eventually bring in about 2.3 billion euros (or 1 percent of gross domestic product) instead of the original target of 4 billion euros. He added that the central government deficit will amount to 28.9 billion euros and not the 12.7 billion euros that the updated Stability and Growth Pact had provided for. Losses in revenues amount to 10 billion euros and the excess in expenditures comes to 4 billion euros. The budget’s «black hole» for the nine months to September amounted to 8.3 billion euros or 3.4 percent of GDP, taking the budget deficit to 23 billion euros, while last year it had stood at just 12.2 billion euros, according to the data Papaconstantinou forwarded to Almunia. The Greek minister attributed the budget problems to three main things: the larger-than-expected decline in real GDP, an election cycle that came at the worst possible moment, Papaconstantinou argued, and the nonrecording of expenditures such as of those for state procurements. He went on to promise that he will promote some «aggressive» structural reforms to supplement the other reforms planned and ensure the viability of public finances while also boosting competitiveness.