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Eurozone Focuses on Greece

(GREEK NEWS AGENDA) Greece has failed to take the necessary measures to cut its fiscal deficit, according to the directions offered last spring by the EU Council, the European Commission (EC) announced on Wednesday, before recommending that the country be placed under excessive deficit procedure of Article 104(8) of the Treaty of Maastricht.

Responding to this, Finance Minister George Papaconstantinou said that the government is determined to restore the credibility of its macro-economic statistics and reduce its large fiscal deficit.In its autumn forecasts, released last week, the EC sees Greece’s budget deficit remaining above 12% of GDP through 2011 – at 12.2% in 2010 and 12.8% in 2011. “We do not share the EC’s projections that see the deficit over 12% in the coming years. This projection was made without taking into account the change in policy,” said Papaconstantinou, who believes he can lower the budget deficit to below 10% next year. “We are changing policy and this will be reflected in the next budgets,” he said.
Kathimerini daily:Eurozone concerned about Greece


EU’s Enlargement Strategy

(GREEK NEWS AGENDA)  The European Commission (EC) adopted its annual strategy on European Enlargement yesterday (October 14).  Commissioner for Enlargement Olli Rehn urged Skopje to settle the name issue with Greece, after announcing that FYROM now “meets” the criteria for opening accession negotiations.   Rehn added that he viewed the launch of talks with FYROM as “a very strong encouragement” in this direction and expressed his hope that “the government in Skopje gets this message as well.”  Regarding Turkey’s accession, Rehn revealed EC’s dissatisfaction with its progress and called on Turkey’s obligation, as an aspiring EU member state, to open its air and ports to Cyprus.  Turkey must contribute to the resolution of the Cyprus issue with “concrete terms,” during negotiations, he added.

Commenting on the EU’s progress reports, Alternate Foreign Minister Dimitris Droutsas stressed that Greece is promoting the accession course for all Southeast Europe countries, by already having put forward a roadmap until 2014.  “The prerequisite for this course is that all the countries should […] fulfil the necessary criteria. With regard to FYROM, in particular, this means finding a solution on the name issue” said Droutsas.  Kathimerini Daily: EU nod for FYROM despite name   Greek News Agenda: SEECP Meeting- A roadmap for accession

EU Aid for Migration Comes with Terms

(GREEK NEWS AGENDA)  The European Union through its representative Vice-president of the European Commission and responsible for justice, freedom and security, Jacques Barrot pledged to assist Greece in its efforts to deal with the influx of migrants, but said that the country must improve the process of reviewing asylum applications with the involvement of specialists, and make better provision for vulnerable migrant groups such as women and children.  Barrot, who is currently visiting Greece attending the works of the European Popular Party’s Study Days, met with both the Prime Minister and the Interior Minister, reassuring them that the European Union intends to pressure Turkey to honour its bilateral agreement with Greece. Barrot also said the EC would help Turkey strike up repatriation agreements with migrants’ countries of origin.  Kathimerini daily: EU vows to help with immgration; Greek News Agenda: Diplomacy on Migration & Illegal Migration: Going European 

Greek Financial Ministe: Economy Resistant to Crisis

The Greek economy is showing stronger resistance to pressure from the ongoing global economic crisis, Economy and Finance Minister Yiannis Papathanassiou stressed on Monday. Commenting on the European Commission’s (EC) spring economic forecasts, the minister said the Commission cut forecasts over economic growth in the Eurozone and the EU, noting that Greece – although projected to present a negative growth rate this year – was showing stronger resistance compared with other eurozone countries. 
Papathanassiou stressed that the EC’s forecast for Greece does not take into account recent government steps aimed at boosting the economy. The EC’s forecast predicts that the Greek economy will present a negative growth rate of 0.9% in 2009 – compared with other countries where the economy was expected to shrink by 4.0% – before recovering to a growth rate of 0.1% in 2010.

The finance ministry is more optimistic and is sticking to its anticipated expansion rate of 1.1% for this year, emphasising that “the Commission’s latest forecasts have not taken into account recent measures taken by the government to support economic growth, such as measures to boost construction activity, the car market and employment,” said the minister. 
In any case, Papathanassiou said, the government would re-evaluate economic progress in June and if needed, would make any necessary adjustments to achieve its budget targets. 
European Commission: Economic Forecast Spring 2009 – Greece ; Athens News Agency: Negative growth in 2009; Ministry of Economy and Finance: Statements by Finance Minister Yiannis Papathansiou on EC’s forecast (May 4, in Greek)

Positive Growth for Greece at Negative Conjuncture

(GREEK NEWS AGENDA)  The European Commission (EC) on Monday released its interim forecasts on European economies for up to 2010, anticipating recession in the Union with an increase in deficits, but also a reduction in inflation. Specifically for Greece, the country will be one of the five within the eurozone to demonstrate marginal growth, while at the same time negative growth rates are foreseen for 11 of the 16 eurozone members and for 18 of the 27 EU member states. The Commission noted that deficits above the 3.0% limit are anticipated this year in 9 of the 16 eurozone members and 15 of the 27 EU member states. According to the Commission, Greece’s fiscal deficit will increase from 3.4% points of GDP in 2008 to 3.7% in 2009 and 4.2% in 2010, taking into consideration, however, that the basic guidelines of the draft 2010 state budget have not yet been released. Regarding Greece’s fiscal deficit, it will climb from 3.4% points of GDP in 2008 to 3.7% in 2009 and 4.2% in 2010, taking into consideration, however, that the basic guidelines of the draft 2010 state budget have not yet been released. The Commission noted that deficits above the 3.0% limit are anticipated this year in 9 of the 16 eurozone members and 15 of the 27 EU member states. Concerning unemployment, the rate stood at 8.3% in 2008 (compared with a eurozone average of 7.5% and EU average of 7 percent), while it is expected to rise to 9% in 2009 (against 9.3% in the eurozone and 8.7% in the EU). With regard to performance in the eurozone, European Commissioner Joaquin Almunia stressed that there will be no break-up of the eurozone. Following a meeting with Minister of Economy and Finance Yiannis Papathanassiou today, Jean-Claude Juncker, president of the eurozone group stated that “Greece is not the only country with an excessive deficit” and added that “we will handle Greece, the way we handle all other member states with respective problems”. In related predictions, the Organisation for Economic Cooperation and Development (OECD) released its semi-annual “Economic Outlook” (November 2008) forecasts that the Greek economy’s growth rate will be gradually stabilised in the second quarter of 2009, after staying at feeble levels during the first six months of next year. Meanwhile, in its “World Economic Outlook“, released in October 2008, the International Monetary Fund (IMF) foresaw growth in Greece at 2%. Athens News Agency: EU Commission report on Greece European Commission: Economic and Financial Affairs- EU interim forecasts for 2009-2010- Greece (December 2007)  (p.26) 

FinMin on Forecast

After meeting with EU Economic and Monetary Affairs Commissioner Joaquin Almunia in Brussels yesterday, Economy and Finance Minister Yiannis Papathanassiou said the government’s economic priorities would focus
-on fiscal adjustment,
-support of the real economy
-support of the social groups hardest hit by the downturn
“We believe that with the policies we follow, we will have positive results and achieve better performance than the Commission has forecast for Greece,” he said. Next week, the finance ministry is expected to submit to Brussels its updated Stability and Growth Programme, in which it will lower its GDP growth target for 2009 from 2.7% currently. Kathimerini daily: Beating grim Brussels forecasts Ministry of Economy and Finance: The 2007 Update of the Hellenic Stability & Growth Programme 2007 – 2010