“The major task of reforming Greece has just begun,” the Greek Prime Minister George Papandreou said during a press conference at the Thessaloniki International Fair on Sunday.
Corruption and a lack of transparency cost Greece the equivalent of 8 percent of our [gross domestic product], or a shortfall of 20 billion euros to the public purse.
The Greek Prime Minister insisted that his government was not planning any new austerity measures and that it would continue with its implementation of the program of reforms it had agreed to with the European Union (EU) and the International Monetary Fund (IMF).
Mr Papandreou appealed to Greeks whose salaries and pensions have been cut to “join a collective effort” so that Greece can make good on its commitments to international creditors and regain its fiscal independence by 2013.
Mr Papandreou held out hope that by the end of the year his government might distribute a “social dividend” for low-income pensioners, if it meets its government revenue targets.
Mr Papandreou’s one concession was to companies that have been hit hard by a deepening recession.
He announced that reductions in corporate taxes from 24 percent to 20 percent, scheduled for 2014 will now be put in place in 2011.
“Our aim is to boost businesses that are trying to survive,” he said.
Despite all the sacrifices so far and the painful changes ahead, Mr Papandreou said, Greeks had “every reason to feel hopeful,” noting that the country was on course to fulfil its commitments to the EU and IMF by 2013.
Asked whether Greece might ask for an extension of the EU-IMF package beyond its 2013 end date, Papandreou said the government did not intend to ask for an extension, and could even leave the program early if good progress was made.
The year 2013 “is truly the end of this process,” Papandreou said.
“The faster we complete the major reforms in our country…the sooner we will be able to exit these restrictions. That could even happen before 2013, provided we do well.”
In the meantime, he said, his government would “support the vulnerable,” especially the jobless.
Papandreou said that his administration would create at least 200,000 new jobs by approving new wind farms and solar parks and by deregulating a range of professions which have been tightly regulated.
The Papandreou government’s main challenge now is to boost revenue, which is lagging behind targets, although the shortfall is offset by better than expected performance in spending cuts.
According to the latest figures released by the Finance Ministry last week, net revenue increased 3.3 percent in the first eight months of the year, against a target of 13.7 percent.
Mr Papandreou also promised to strengthen its pursuit of tax dodgers and corrupt officials.
“Corruption and a lack of transparency cost Greece the equivalent of 8 percent of our [gross domestic product], or a shortfall of 20 billion euros to the public purse,” he said.
Mr Papandreou defended the IMF and the EU.
“It’s not the IMF and EU that are at fault for the bitter medicine Greece has to swallow, but rather the debts amassed over many decades, and the ineffective state and the political social culture that developed,” Mr Papandreou said.
“Altogether we will fundamentally reshape the country and exit from the crisis that brought us to the brink of catastrophe,” he said.
Source: Associated Press, New York Times, Reuters