NEWS

PM sees no need for bailout

As negotiations continued over the weekend between Greek and European Union officials about whether the government will have to take extra fiscal measures, Prime Minister George Papandreou insisted yesterday that Greece is not looking for a financial bailout from Brussels but wants political support. Greece has been given until the middle of next month to show that the public sector spending cuts and tax adjustments it is making are beginning to help bring down its spiraling public debt and deficit. The EU has already made it clear that if progress is not being made, the government will have to adopt further austerity measures. One of the proposals being discussed is that public servants, who earn 14 monthly wages, as do many private sector workers, should lose one of those salaries. The government is totally opposed to this idea, fearing a backlash from bureaucrats and unions and has been trying to put together its own counter-proposals, which it might discuss with officials from the European Commission, European Central Bank and International Monetary Fund, who are due to visit Athens this week. Speaking to the BBC yesterday, Papandreou said that Greece is not seeking a bailout from the EU or anyone else, although he did not rule out help in obtaining a loan guarantee or that China or Russia might be interested in buying Greek bonds. Papandreou said Greece is looking for political backing from its EU partners. «We need the help so that we can borrow at the same rate as other countries, not at high rates which undermine our ability to make the changes we have to make,» he said. The premier also said that Greece would not be issuing any new bonds next week as requirements are covered «until mid-March.» He also said he is confident that his government will show the EU that it can get the Greek economy back on track. «We’re on target, beyond target on January statistics, so we’re doing well,» he said. «If we do need extra measures, we will take them in order to reduce our deficit this year by 4 percent [of GDP]. We’re ready to do so if necessary.»