European Commission forecasts that Greece will slide into its first recession since 1993 this year do not reflect the Greek government’s latest efforts to boost the economy, Greek Finance Minister Yannis Papathanasiou said last week.
‘The Commission’s latest forecasts do not take into account the recent measures taken by the government to strengthen economic growth, such as the measures to boost construction, the car market and employment,’ Papathanassiou said.
The Commission said in its spring forecast on Monday that Greek GDP may shrink by 0.9 percent this year due to slower private consumption growth and falling investment.
That compares to the government’s most recent forecast of a 1.1 percent expansion.
‘As it has already stated, the government will evaluate in June the course of the economy and, if necessary, proceed to the required adjustments to implement the targets set,’ Papathanassiou said.
The Greek government said earlier this month it wants to narrow the budget deficit to 3.7 percent of GDP this year and bring it below a 3-percent threshold for euro zone members by the end of 2010.
Last week, the ministry said it will subsidize loans and increase tax benefits for property buyers in a bid to boost the construction sector after having announced recent cuts in registration tax for new cars.
The Karamanlis government has also announced a 2.5-billion-euro program aimed at stemming rising jobless numbers in Greece.