ECONOMY

IMF says Greece ‘clearly on track’

International Monetary Fund Managing Director Dominique Strauss-Kahn said Greece’s economic efforts were clearly on track and that a revision of deficit and debt figures from previous years was unfortunate. «Today Greece is clearly on track and that’s the most important thing that has to be underlined,» Strauss-Kahn said at a news conference in Washington. «It is very unfortunate that the figures are going to be revised.» He said the IMF was waiting to see the details of how large the revision is. Earlier this week, the European Union confirmed that estimates of Greece’s budget deficit and government debt will be revised higher for the years 2006-09 in data expected to be released by October 22. Finance Minister Giorgos Papaconstantinou has said that he doesn’t know how high last year’s budget shortfall may reach due to the revision as EU statistics agency Eurostat is to include in general government debt money owed by state enterprises and currency swaps. However, a senior government source indicated that the 2009 budget deficit is likely to be revised higher to just over 15 percent of gross domestic product from 13.8 percent previously. The changes will also mean that Greek debt will rise to 127 percent of GDP from 115.4 percent of GDP previously. Papaconstantinou is scheduled to meet with Strauss-Kahn in Washington on Sunday where they will look at the general health of the Greek economy, including galloping inflation weakening consumer spending power. Data released by the Hellenic Statistical Authority (ELSTAT) yesterday showed that Greek consumer inflation hit a 13-year high of 5.6 percent year-on-year in September following rises in value-added tax imposed by the government under the terms of the European Union-IMF bailout. Month-on-month, consumer prices rose 1.9 percent, statistics agency ELSTAT said. Greece has raised the value-added tax rate to 23 percent from 21 percent along with increases in excise duties to boost budget revenues as it scrambles to slash deficits. The EU and the IMF have revised this year’s inflation forecast for Greece to 4.75 percent from a previous 1.9 percent.