The economy under review

Tuesday’s Cabinet reshuffle has signaled the postponement of legislation aimed at spurring development as the National Economy and Finance Ministry’s new leadership appears to be studying the timing, at least, of presenting legislation prepared by former minister Yiannos Papantoniou. National Economy Minister Nikos Christodoulakis and his aides are considering revisions to economic policy in general, on the basis of more realistic approaches to the country’s finances and competitiveness. First indications are that they are thinking of revising the 2002 budget in view of the effect that the international crisis is having on economic indicators. Deputy Economy Minister Christos Pachtas said yesterday that a review of the development law, despite the fact that it is a government priority, will be held without urgency. The dialogue for the changes that may be made, he said, will begin in the spring of 2002. First the effectiveness of the bill will be studied and then the dialogue with the interested parties will begin, he said. Papantoniou, who has moved to the Defense Ministry, said earlier this month that the dialogue for changes to the bill would begin at the end of October. He had stressed that the legislation would be presented to Parliament at the end of the year and would be voted on in 2002. The legislation, sources say, includes an increase in tax breaks in combination with an effort to focus subsidies on regions that show a dearth of development, and the adoption of simple, flexible and effective processes that exploit the financial system. This means that a major part of the supervision of these procedures will go from the Economy Ministry to financial institutions. Ministry officials believe that in this way the law will become more flexible as the State and its services will not have to conduct the inspections that they do now. The ministry also wants to to strengthen the role played by the Hellenic Center for Investment (ELKE), which can play a greater role in evaluating investments. Greece began to concentrate on attracting investments at the beginning of the 1990s, with the incentive of providing direct subsidies for investments. As the initial aim of attracting investments was achieved, the subsidies were reduced. This was necessary because the country’s course toward becoming a member of the EU’s Economic and Monetary Union demanded a more careful fiscal policy and the limiting of deficits. Christodoulakis met yesterday with his successor at the Development Ministry, Akis Tsochadzopoulos, and they agreed on the need to quickly privatize the Public Power Corporation and find a strategic partner for Hellenic Petroleum. Airport dues. Aircraft landing and parking charges at the new Spata airport will be reduced between 5-60 percent as of November 1, the airport management said yesterday.

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