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The public debt reached 5%

22 April 2009 / 11:04:35  GRReporter
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Today the European Union Statistics Services is supposed to officially announce the reassessed Greek public debt, which is now 5% of the country’s GDP. The official requirement of the eurozone is for it not to exceed 3%. Basically, reassessing the public debt means stricter restrictions on public expenses and stricter policy on the Greek government’s incomes. With the latest unpopular measures, Kostas Karamanlis’ team announced, that it is guaranteeing income of ?1.8 billion. With this public debt situation, the needed income is ?5 billion.

The European Commission assessed the measures of the Greek government as insufficient and temporary and predicted that the public debt will remain 5% throughout 2009. Some analyzers believe that the debt will keep raising and will reach 7%. They also believe that no matter how obvious it is that extreme measures must be taken, Karamanlis’ government will not undertake anything before the European parliament elections in June. It is expected that in May, the European Commission will announce its forecasts about the progress of the European economy. When it comes to Greece, this prognosis will be very unfavorable – GDP growth of 0% and 2009 public debt of about 5%.

Meanwhile, in an article titled “Aegean fog,” the Economist magazine analyzes the Greek economy and predicts a drop in the tourist flood of 15 to 20 percent for 2009. “For the last 15 years, the Greeks were sustaining a GDP growth of 4% and this made them prodigal and not willing to save,” claims the publication. According to the magazine the main problem of the Greek economy is modernizing the system of the healthcare and retirement reform.

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