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One important problem, as noted, is to ensure that the larger share of state capital will not cause undue government interference in banks. According to the report, Greece’s experience with banks that operate under state control is poor, which requires an enhanced governance framework, strong supervision and, above all, a very rapid re-privatization of the four major banks.
 
The top priority of the banking system, as noted, must be to upturn the trend of bad loans. The report stresses the need for introducing as soon as possible a general framework to strengthen the private debt. In this context, the decision of the Greek authorities to apply a framework to deal with the unjust obligations of households is highly appreciated.

The report states that in order for the Greek economy to continue to recover at a fast pace, the country will have to intensify the structural reforms, restore exports, facilitate the attraction of investments, improve the business climate and accelerate the privatization process.

The report stresses the view that the recovery of development remains the main prerequisite for Greece to be able to move forward. As for the 2010-2012 period, it notes that the decline, which was much sharper than expected, was mainly due to the gradual loss of confidence, the height of which were the rumours that the country would leave the euro zone. Another reason for this was the ever-increasing political uncertainty and the increasingly apparent lack of political will to tackle the vested interests and to implement the reforms. According to the report, all this was combined with a dramatic fall in investment.

As for the prospect of debt reduction, the International Monetary Fund draws attention to two issues, namely, the improvement of confidence to the required levels in order to increase investment and the commitment of the European partners as regards the viability of the debt in order for the programme to remain in force and for the debt to fall significantly below 110% of GDP by 2022.