Greek austerity 'beginning to show results', +2.9% in 2015

Staikouras presents draft budget, sacrifices will not be wasted

06 October, 16:53

    Press conference of Alternate Finance Minister Christos Staikouras Press conference of Alternate Finance Minister Christos Staikouras

    (by Furio Morroni) (ANSAmed) - ATHENS, OCTOBER 6 - After six years of a severe economic crisis and a recession that has cost Greece a quarter of its GDP, austerity measures brought in by the three successive governments under PMs Papandreou, Papadimos and Samaras finally seem to be showing results.

    According to the Greek draft budget presented on Monday morning in Parliament by Alternate Finance Minister Christos Staikouras, there will be a 2.9% rise in GDP in 2015, just under the 3% target established in the EU-IMF bailout plan. GDP is expected to rise by 0.6% this year. As a result, the Athens government expects to be able to leave the 240-billion-euro bailout plan drawn up by international creditors at the end of 2014, more than a year ahead of schedule. As part of the draft budget, which will be debated in Parliament until Wednesday, Greece plans to issue 7-year and 10-year government bonds as well as a short-term treasury bond that would mature over a period greater than six months, the current maximum. Unemployment is set to drop to 22.5% in 2015 from the 24.5% average this year. Debt is also expected to fall, from 168% of GDP in 2015 from 175% this year. ''The country is entering a long period of sustainable growth and primary budget surplus that will foster employment, reduce unemployment and improve citizens' lives,'' Staikouras said. ''This is the result of unprecedented sacrifices made by Greek families and businesses.'' ''Those sacrifices will not be wasted,'' he added. Despite the optimism shown by Athens, the improvement in Greek public finances is said not to have been enough to convince all European creditors to agree to the program drawn up by Prime Minister Antonis Samaras to exit the bailout plan by the end of 2014. On April 9, Greece returned to international markets after a four-year absence, with the issuance of five-year treasury bonds worth 2.5 billion euros, and Samaras has repeatedly said that the country will be able to cover its financing needs on its own on the markets even after the bailout plan expires in December. However, several economists say that international creditors would prefer Greece keep as a precautionary measure some form of guarantee to support its economic policies if market conditions were to worsen. Parliamentary debate on the draft budget will likely be a heated affair between the coalition government - which includes the conservative party Nea Dimokratia under PM Samaras and the socialist party PASOK - and the opposition under radical leftist party Syriza. Samaras agreed in recent days to a confidence vote in Parliament by the end of the current week in order to bolster the credibility of his government following harsh criticism from Syriza, which has long called for early elections and an end to austerity measures. (ANSAmed).

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