NEWS

PASOK, ND differ wildly over economy

Prime Minister Costas Simitis and New Democracy leader Costas Karamanlis presented diametrically different views of the economy in Parliament last night. Also, in what has become routine, they accused each other of being in cahoots with unnamed business interests. Late in the debate, responding to a comment from an ND MP, Simitis turned up the heat further, repeating a claim that police had kept tabs on him under an ND government. «Why? Because I had fought against the dictatorship when others sat at home,» he shouted, referring to the 1967-74 junta and his planting of bombs. «I was underground. Where were you? I placed crackers, as we called them, because I wanted freedom. What did you do?» On the economy, he said: «Today we are far from the dangers of 10 years ago. Today we have capabilities far greater than those we had a decade ago when we started this effort… We are in the Economic and Monetary Union, but this does not mean that we can rest, that we are in the clear. On the contrary, this gives us the opportunity to achieve even more by working harder.» Simitis referred to the forecast of 4.1 percent of GDP growth this year. «Our growth rate in 2002 was 4 percent of GDP, the second highest in the EU. In 2003 it is forecast to be the highest in the EU,» he said. «Unemployment was reduced in recent years, from 11.9 percent in 1999 to 9.9 percent in 2002. This is not enough and we have to try harder… We want to bring unemployment down to at least 7. 5 percent in 2006.» He said that the public debt had been reduced by 12 percent over the past 10 years. «If we did not have to spend 2.5-3 percent of our GDP on extra defense spending with regard to the rest of Europe, our public debt would be similar to the European average. Despite this, our aim is to reduce the debt to 90 percent of GDP by 2006,» he said. «Incomes in 2000-2002 increased by 3 percent in real terms when the EU average over the same period was just 1.3 percent… In 2003, wage earners and pensioners alone will pay 545 million euros (186 billion drachmas) less taxes in 2003 than they would have paid if we had not reformed the tax system.» Karamanlis declared: «The economy is becoming more and more problematic. The market is frozen. Unemployment and high prices have become a noose for the weaker strata. Farmers, small and medium-sized businesses see their potential limited… At the same time, the budget is off track, public borrowing is growing, competitiveness is worsening, EU funds are lost, social and regional inequality widens, and the extended crisis on the stock exchange continues. All this creates a woeful picture of the real economy. The country is facing a serious fiscal crisis and the government refuses even to recognize the existence of a problem.»