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Athens News Agency: News in English, 10-08-08

Athens News Agency: News in English Directory - Previous Article - Next Article

From: The Athens News Agency at <>


  • [01] EC-IMF: More still to be done
  • [02] Inflation at 5.5pct
  • [03] Focus on deregulation, not privatisation
  • [04] Athens Newspaper Headlines

  • [01] EC-IMF: More still to be done

    European Commission (EC) Deputy Director General for economic and financial affairs Servaas Deroose and International Monetary Fund (IMF) European Department deputy director Poul Thomsen, who headed the EC and IMF teams in Athens last week, praised the progress so far in the Greek economy, in interviews appearing in two Sunday newspapers, but also stressed that there is still much that needs to be done.

    In an interview with Ethnos newspaper appearing on Sunday, Thomsen stressed that there is no need for new measures this year, neither with respect to expenditures nor with respect to revenues, and voiced optimism that the fiscal targets for September and December will be met.

    Deroose, in his own interview with To Vima appearing on Sunday, said he was impressed with the progress to date, adding that Greece is changing and that "a revolution is in process".

    Both men clarified that the troika (EC, IMF and European Central Bank-ECB) have never asked, and are not asking, for the sale of Public Power Corporation (PPC) units, nor has it asked for dismissals in the public sector and the DEKO (public utilities and organisations), while Poul spoke of a social choice of the government, which is respected, but both stressed that the commitment for one hiring per five outgoing personnel must be adhered to.

    Deroose also stressed that there will be no restructuring of Greece's debt, belying local and foreign speculation.

    The way to reducing the Greek debt by half, according to Deroose, is first of all for the country to achieve a primary surplus of 5 percentage points of GDP and the reforms must result in 3 percent growth. He considers both these targets absolutely feasible and, in such a case, the debt will be halved from its present level in a decade.

    On the deficit, he said that if it falls to below 8 percentage points of GDP this would send a very strong message to the markets that the program is successful and functional. He warned, however, that the measures taken must not be reversed, such as reinstatement of the so-called 13th and 14th salaries. "That would not be wise," Deroose said.

    Tackling the thorny issue of tax evasion, Thomsen said that a fairer program is necessary that will tax the higher incomes. He does not believe that the tax rates need to be increased beyond what is foreseen in the Memorandum, but that the program must be strictly implemented. What is important, he continued, is that the political will exists to impose adherence to the law, and agreed with imprisonment in cases of large-scale tax evasion.

    Replying to a relevant question, Thomsen said that the political consensus on implementation of the Memorandum was not to the degree he hoped for, while Deroose, in reply to a question, denied press reports that the troika has prohibited early general elections. "That is wrong," he said, adding that "it is not our job to suggest if and when elections will be held in a country to which we are providing assistance".

    [02] Inflation at 5.5pct

    Greek inflation was running at 5.5 percent year-on-year in July 2010, according to figures released on Friday by the independent Hellenic Statistical Authority (EL.STAT.), marking a 13-year high and returning to 1997 levels (5.4 percent in July 1997).

    More specifically, the Consumer Price Index (CPI) in July 2010, as compared to July 2009, increased by 5.5%. A year earlier, the annual rate of change of the CPI was 0.6%.

    The CPI in July 2010, as compared to June 2010, decreased by 0.5%. A year earlier, the monthly rate of change of the CPI was -0.7%.

    In the twelve-month period June 09 - May 10 the average rate of change of the CPI was 3.1%. A year earlier, the corresponding rate of change of the CPI was 2.1%.

    Also, the Harmonized Index of Consumer Prices recorded a rise of 5.5 % in July 2010 as compared to July 2009.

    More specifically, the Harmonized Index of Consumer Prices (HICP) in July 2010, as compared to July 2009, increased by 5.5%. A year earlier, the annual rate of change of the HICP was 0.7%.

    The HICP in July 2010, as compared to June 2010, decreased by 0.4%. A year earlier, the monthly rate of change of the HICP was -0.7%.

    In the twelve month period August 09 - July 10 the annual average rate of change of the HICP was 3.1%. A year earlier, the annual average rate of change of the HICP was 2.3%.

    The European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) 'troika' inspectors, who were in Athens over the past week for their first quarterly progress report on implementation of the Memorandum, have already revised upwards their predictions for inflation in Greece to a mean 4.75 percent for the year, as announced on Thursday, based chiefly on the increase in indirect taxes. Similar forecasts were made by finance minister George Papaconstantinou, who pointed out that the inflation forecast is being revised on the basis of the developments of the recent months.

    According to Papaconstantinou, the target is implementation of all the special actions for revision of the institutional framework and competition, enhancing the independence of the Competition Committee, and a study on the contribution of retail trade to price competitiveness, employment and growth.

    [03] Focus on deregulation, not privatisation

    The government and the EU-IMF troika are focusing their attention on deregulation of the energy market and not on privatisation of Public Power Corporation (PPC) units, environment, energy and climate change minister Tina Birbili said in an interview appearing in the Realnews newspaper on Sunday.

    There is a specific area for private initiative in energy production from renewable sources, from natural gas and from lignite, she said, reiterating that the government has not intention of privatising the PPC in the deregulation of the energy market.

    Commenting on the strong reactions by PPC unionists, Birbili said that "we are all on the same side, because we have common targets", adding that the dialogue should be carried on in a cool-headed manner and that "elements of antagonism or coercion must be avoided".

    She said that the liberalisation of the wholesale market is a major issue for the government, and namely "those conditions that will allow the penetration and survival of private enterprises", adding that "the investments that will be carried out will create new jobs and contribute to the production of national wealth".

    Birbili left open the possibility of increasing household electricity rates in 2011, noting that if the household rates increase, "it will be a decision that will be taken by the government with very great social sensitivity, especially in a period of crisis".

    [04] Athens Newspaper Headlines

    Athens' Sunday newspapers at a glance

    The government's consultations with the EU-IMF troika and rumored changes and the upcoming local government elections were the main front-page items in Sunday's newspapers.

    ADESMEFTOS TYPOS: "Chaos ahead with the pensions of 800,000 professionals".

    APOGEVMATINI: "Plan to abolish the building coefficient".

    AVGHI: "Who is governing this country: The troika, with aura of government, announced what must be done this year and next year".

    AVRIANI: "PASOK-affiliated trade unionists' ultimatum to George (prime minister Papandreou) - They warned the premier to stop the reforms, otherwise they will topple the government".

    CHORA: "4+1 'hot' fronts opening up in autumn - Harsh measures coming in 2011".

    ELEFTHEROS TYPOS: "The ND-PASOK 'duelists' in municipalities and peripheries - The 'trump cards' and the surprises planned by Samaras and Papandreou".

    ELEFTHEROTYPIA: "The Tax Bureau's client list - List of companies and individuals who will be called on to settle their debts".

    ETHNOS: "Sweeping changes for salaries, commuter tickets and personnel - Government mulling shock-proposal for public transport".

    KATHIMERINI: "Plan B for the Memorandum - The commitments the government made to the troika for cutting 2 billion euros in expenditure".

    LOGOS: "Hot autumn in view of third tranche of EU-IMF loan - The troika warns that next time it will not be lenient".

    NIKI: "For whom the bell tolls in the public sector - The nightmare of layoffs awakens bad memories".

    PARON: "250,000 dismissals - Ultimatum from the EU".

    RIZOSPASTIS: "Unceasing raid on the people's interests by government, troika and plutocracy".

    TO VIMA: "Reversals everywhere in social state, growth and government - August a month of major changes".

    VRADYNI: "Single salary scale: the changes to the civil servants' remuneration - What the troika wants, what the government will do".

    Athens News Agency: News in English Directory - Previous Article - Next Article
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