NEWS

2002 budget under review

The debate over the draft budget for 2002 is to begin today and National Economy and Finance Minister Nikos Christodoulakis has to deal with the great expectations that have arisen from the change in the government’s economic team as well as the harsh reality caused by the difficult international climate and the problems in the Greek economy. Christodoulakis met yesterday with Prime Minister Costas Simitis and briefed him on the problems that have accumulated because of the international crisis, the effects that this will have on Greece’s rate of growth and the fiscal limitations that do not allow much room to support the growth rate. Sources say that Christodoulakis is looking for a more flexible approach to the stability pact from Greece’s partners in the European Union so as to come to a more realistic fiscal policy that will be able to prevent the growth rate from being burdened further, if not actually support it. According to present indications, Germany, which has come under the greatest pressure in Europe because of the international crisis, foresees a widening of its fiscal deficit to 2 percent of GDP. This creates the impression that Greece, which has forecast in its draft budget a surplus of 1.3 percent of GDP, will receive some room to maneuver. During the debate on the draft budget, Christodoulakis will stress the possibility of more flexibility to deal with the changing international conditions. Any adaptations will be made by November 21, when the budget will be presented, after international organizations have announced their forecasts for the international and European economy. What is certain is that Christodoulakis does not want to commit economic policy from now and will maintain a high level of flexibility in order to change according to the environment that will emerge. Train strike