NEWS

PM warns of another tough year

As the draft budget for 2011 was presented yesterday, Prime Minister George Papadandreou warned his ministerial team and the Greek people that they are only nearing the end of the «first half» of their fight to get the country’s public finances back on track. Papandreou said that next year would be crucial to Greece’s effort to slash its public deficit further and get the economy on the road to growth. «If we succeed in 2011, and we will succeed, we will have real cause to believe that the economy will change direction and that 2012 will be a year of growth,» he told the Cabinet, which approved the draft budget. «Our success in 2011 will be the crucial second half,» said Papandreou. «After 2011, the deficit will mainly be connected to the needs of servicing our large debt and not to the creation of further deficits. Then, 2012 will be a year of growth, supported by a sound basis, not borrowed money.» The government aims to reduce Greece’s deficit by 7 percent this year but this will be accompanied by a hike in VAT on some products and services, and a projected rise in unemployment to 15 percent by the end of 2011. Yesterday marked one year since PASOK came to power and Papandreou used this as an opportunity to remind people of the poor state in which New Democracy had left public finances. «Nobody could have expected such irresponsibility and self-destructiveness,» said Papandreou. ND leader Antonis Samaras has suggested that a conservative government would wipe out Greece’s deficit by the end of next year. Papandreou laughed off this idea. «Today they talk about zeroing the deficit but they are the ones who in five-and-a-half years in power managed to get it so high,» he said. «They criticize us about the pension funds having no money but they are the ones that emptied them. The money was there but the question is what they did with it.» New Democracy’s response was to produce a 33-page document listing what the conservatives see as PASOK’s failures in handling the economic crisis during its year in power. Samaras is expected to deliver a speech on the same subject today. «Citizens realize that Mr Papandreou misled them and that the people who in the election campaign promised that the money would be found are the same ones who have dragged Greece toward the [EU-IMF] memorandum,» said ND deputy Maximos Harakopoulos.