Greece ups 2012 budget deficit target in draft law

Greece now sees a 2012 budget deficit of 6.7 percent of gross domestic output, up from an original target of 5.4 percent in its initial 2012 budget, according to a draft law of new austerity measures posted to the parliament website on Tuesday.

Its 2012 primary deficit – calculated by removing interest payments on debt – will come out as 0.2 percent, according to the draft law, within limits set out in return for a 130-billion-euro bailout package agreed earlier by euro zone states.

“The bigger than expected recession of the Greek economy resulted in shortfalls between the initial estimates and the final results for the fiscal year 2011. As a result of this shortfall there is a need to adjust the figures of the 2012 budget,» the law stated.