Growth to average 4 pct over 3 years

Economic growth is set to average 4 percent over the next three years while budget deficits will drop to 2.5 percent of GDP in 2007, according to the revised stability and growth plan submitted to Brussels yesterday by the Economy and Finance Ministry. The ambitious plan handed to the European Commission also foresees a drop in the public debt to 102.5 percent of Gross Domestic Product in three years’ time. Growth is set to rise from 3.7 percent in 2004 to 3.9 percent next year. In 2006, the economy is expected to grow by 4.0 percent, reaching 4.2 percent in 2007. In the case of an unfavorable international environment, growth will average 3.3 percent over the next three years, according to an alternative, worst-case scenario outlined in the plan. Meanwhile, the budget deficit – a sensitive issue since the ruling conservatives revised upward all the figures provided by the previous, Socialist government – is expected to remain below the eurozone ceiling of 3 percent of GDP, for the first time since Greece adopted the euro in 2001. The figure for this year has been forecast at 5.3 percent. In the new stability and growth plan, the government insisted that the deficit will be slashed to 2.8 percent in 2005, and will fall further to 2.6 percent in 2006 and 2.5 percent in 2007. The public debt is set to dip from 112.1 percent this year to 109.5 percent in 2005, 106 percent in 2006 and 102.5 percent in 2007.