THE GREEK PRIME Minister has vowed to press on with austerity measures in order to meet savings targets that will ensure international loans continue to flow.
George Papandreou delivered his annual speech on the economy in the Greek city of Thessaloniki last night, PA reports, in which he said the major concern was to keep Greece solvent amid a mounting debt crisis that has forced it to seek two EU/IMF bailouts over the past year or so.
As he spoke, protesters clashed with police on the streets. At least 20,000 people were involved with police arresting more than 100 people, according to BBC News.
“We will push through all the major changes our country has needed for years,” Papandreou said in a nationally televised address. “And we will take whatever other decisions are needed, we will do whatever is necessary to keep the country on its feet.”
After weeks of inactivity, the country is pressing on with austerity measures which include reforms of the public sector and the likely culling of civil servants, once hired on the promise of a job for life.
Papandreou is today meeting with his cabinet to discuss extra measures, including new taxes, in order to meet the 2011 deficit targets agreed with lenders, AP reports.
Greece is required to cut budget overspending from 10.5 per cent to 7.6 per cent of GDP this year, the Telegraph reports.
Market fears were stoked following the resignation of the top European Central Bank (ECB) official Jürgen Stark amid controversy over the ECB’s programme to purchase government bonds in the open market, a practice heavily criticised in Stark’s native Germany.
Meanwhile a poll in today’s Sunday Independent, has found that 49 per cent of people in Ireland favour the country continuing down a road of austerity in the next few budgets in order to meet EU/IMF savings targets.
This is in contrast to 51 per cent of people who think Minister for Finance Michael Noonan should ease back on the austerity measures.
The poll followed a positive report from the European Commission this week in which it said the country had made “important progess” in its financial recovery.
Noonan is expected to cut between €3.6 billion and €4 billion in the December budget through savings and possible tax rises.
The Taoiseach Enda Kenny said this week that “everything is on the table” ahead of the budget.