Tough talk on economy

Prime Minister George Papandreou yesterday gave the first real indication of a possibility of emergency measures being taken by the government to kick-start the reeling economy, describing the country’s burgeoning debt as a potential threat to «national sovereignty.» In unusually strong statements made during a Cabinet meeting, Papandreou described public debt, which is projected to reach 130 percent of gross domestic product next year, as «the biggest threat to national sovereignty since the restoration of democracy,» referring to the fall of the military dictatorship in 1974. The premier cast the blame for this situation squarely on the shoulders of the previous conservative government, saying that New Democracy had «exposed Greece to its international creditors.» But, Papandreou said, his PASOK administration «was determined to do everything necessary to control the massive deficit, to restore fiscal stability and promote growth so Greece can get back on its feet.» The premier’s comments were widely interpreted as an attempt to lay the groundwork for the introduction of emergency measures to lick the economy into shape, as pressure from the European Union, the European Central Bank and international ratings agencies intensifies. According to sources, Papandreou has held a series of initial talks with close aides and industry representatives and may launch a dialogue on possible reforms as early as Monday. The same sources revealed that proposals for emergency measures include a raft of privatizations, an attempt to tackle the hot potato of social security reform and possibly even the freezing of state employees’ salaries. Sources at the Maximos Mansion did not confirm that these proposals were being discussed but neither did they deny it. Reacting to Papandreou’s strong language, the recently elected leader of conservative New Democracy, Antonis Samaras, said it was «a joke.» «We will support any effort, in the right direction, to remove the country from this crisis but this constant faltering by the government cannot continue,» he added.

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