NEWS

PM prepares for keynote economy speech

In his keynote speech on the economy in Thessaloniki next weekend, Prime Minister Costas Karamanlis is expected to confirm his government’s continuing efforts towards fiscal reform and an improved standard of living for Greeks, based on reforms already underway. After a barrage of meetings over the past few days with cabinet members, business and union leaders, and with his own public relations team, the prime minister reached two conclusions. First of all, despite lower than expected revenue and the adverse international economic climate, the general state of the economy is giving rise to greater optimism than at the beginning of the year. Privately, Karamanlis has expressed satisfaction with the results of privatizations so far, as well as the better-than-expected acceptance of his economic reforms, with fiscal readjustment and positive prospects for tourism. Secondly, the reform process has passed the point of no return, not only economically but politically. According to well-informed sources, last week the prime minister was briefed on the initial results of opinion polls carried out for the ruling party that confirm the government has benefited from its policy choices. The same sources say that Karamanlis and his associates are relieved by the news that even the riskiest political changes – in labor relations – does not appear to have detracted from the government’s image. It is this last factor that Minister of State Theodoros Roussopoulos emphasized in his brief to the prime minister in view of the Thessaloniki speech when he reportedly noted the need to fully set out the mid- and long-term effects of reforms on most people’s daily lives. Roussopoulos believes the prime minister should avoid comparing facts and figures but that he should provide examples in setting out goals, time frames and expected effects of economic policy. The poor operation of many public corporations affects not only the government but all taxpayers who are footing the bill, his associates have pointed out. They are referring to the Hellenic Railways Organization (OSE) which in the last 10 years has cost Greek taxpayers more than 4 billion euros (plus interest), an amount equal to the cost of many useful public works projects. Economy and Finance Minister Giorgos Alogoskoufis presented a similar brief to the prime minister. Alogoskoufis believes that in Thessaloniki, Karamanlis must consolidate his image as a «reformist» prime minister who is resisting pressure to make unrealistic handouts (for the time being) and who is steadily proceeding towards an improvement of the economy at all costs. According to some sources, the prime minister will emphasize that changes are being made decisively, cautiously and effectively. He will also link them with the demands of the time and not with the government’s ideological orientation. In that way he hopes to achieve two things: to limit opposition among the people in order to create conditions of consensus and to pull the rug out from under the main opposition’s feet and that of its leadership, whom the public (according to polls) perceives as confused and offering few good policies. The premier’s associates have also drawn up a list of work completed or underway to allow Karamanlis to refute expected criticism from opposition leader George Papandreou regarding «projects left on the drawing board.» A leaflet has been prepared on projects in northern Greece. Karamanlis will also refer to efforts to contain public spending, the potential for developing public assets through partnerships, the impetus for the privatization program, and the new operational framework for public corporations.