NEWS

Economy prevails in Brussels talks

The economy was yesterday at the center of discussions between European Union leaders in Brussels, where Greece was unofficially informed that it would be given until 2010 to reduce its public deficit to below 3 percent of GDP. Prime Minister Costas Karamanlis called for greater cooperation between the EU’s 27 member states to combat the economic crisis, as European leaders appeared to reject calls for greater public spending to improve the situation. Although Karamanlis’s participation in the summit was ostensibly the main focus for the Greek delegation, a keen eye was trained on talks between Economy and Finance Minister Yiannis Papathanassiou and European Monetary Commissioner Joaquin Almunia. Although Greece will not be informed officially until next week about what economic measures the Commission expects Athens to take, Papathanassiou indicated that, as expected, the government will have two years to reduce the country’s deficit. The minister also suggested that no extra measures beyond those already announced, such as a one-off tax of up to 5,000 euros for people earning more than 60,000 euros, would have to be taken as long as growth meets the projected rate of 1.1 percent. One of the other measures announced this week by Papathanassiou was a 5 percent levy on the salaries of MPs, so the money could be used to help those worst affected by the crisis. However, it emerged yesterday that the minister had failed to tell Parliamentary Speaker Dimitris Sioufas about the scheme, prompting the latter, who previously served in the New Democracy government as development minister, to publicly voice his anger at not being informed about the measure before it was announced.