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The great bet - the program for stability and development

28 December 2009 / 16:12:15  GRReporter
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There are great expectations from the Greek Stability and Development Program, which has to be introduced in the parliament until the middle of January 2010. After this it will be sent for approval by the financial experts in Brussels. The main goal of the program is to give a detailed specification of the methods and time frames when the desired decrease of the deficit budget and public debt will be reached until 2013. The final aim is the public debt of Greece to reach the normal for the Eurozone 3% of the Gross Domestic Product, instead of the present 12,7%. For the year 2010 the government PASOK stipulates 54 billion Euro additional credit, the price of which is directly dependent on the stipulated in the program measures for rehabilitation and development. Regarding the public debt (at the moment 113,4% of the GDP) the duty of the national government is to exceed 121,1% of the GDP by the year 2013.

In the beginning of January representative of the European Commission are expected to arrive in Athens. Together with the local financial and economic specialists they will prepare the Program for stability and development. Goal of the visitation is to exclude the possibility of rejection by the financial experts of the European Union of the three years program for development. According to Ministry of finance’s senior officers “probable rejection of the plan would be disastrous for the economy of the country”. Next step for Greece is the visit of group of experts from the International Currency Board (ICB), who would follow closely the development of the economic climate of the country. At the same time the official Eurostat report is expected, with a final assessment of the size of the state deficit for 2008. According to latest forecasts of the European Statistic Institute the value of this index reaches 7,7% of the GDP, without being clear yet how the debt to the hospitals and health care will be allocated in the budget. If Eurostat decides to insert a lower amount for the expenses for healthcare then the budget deficit for 2009 will decrease to 12% from the GDP, which automatically will facilitate the job of the government for 2010 and will lower the value to 8,7% of the GDP.

The reliability of the Greek economy depends directly on the execution of the 2010 budget, which is the first step on the way to economic rehabilitation of the country. “With our actions we have to prove our European partners that we can put in practice everything we are planning (budget 2010)”, claims a source from the Ministry of finance. As a sign of good faith on the part of the government is also the offer to introduce the so called “fiscal Rule”. This innovation will give a chance to take additional measures in the cases of changes from the goals set in the budget. The specialists are explaining that this is an “alarm”, which will prevent the crisis situations like the present one.

Tags: PoliticsEconomy Program for development
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