EU says Greece's austerity program makes "strong start"

09:04, August 06, 2010      

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The European Union said Thursday that Greece's austerity program has made a "strong start" after the EU conducted the first quarterly review of the program with the International Monetary Fund.

"Our overall assessment is that the program has made a strong start," the European Commission, the EU executive arm, said in a joint statement with the IMF and the European Central Bank released after the troika concluded a visit to the country.

"The end-June quantitative performance criteria have all been met, led by a vigorous implementation of the fiscal program, and important reforms are ahead of schedule," the statement said.

The commission said Greek authorities have kept spending significantly below budget limits at the state level and impressive progress is being made on structural reforms.

However, the Commission warmed that important challenges and risks remain.

"Going forward, to address potential risks to fiscal targets, it is critical to tighten expenditure control and monitoring, in particular at sub-national levels," the statement said.

Another key challenge Greek authorities face is to strengthen the tax administration, including the reduction of tax evasion, according to the Commission.

The Commission said that after the review report is formally approved by the Eurogroup and the IMF, Greece is expected to get the second installment of loans of 9 billion euros (11.8 billion U.S. dollars) from the Eurogroup countries and the IMF.

According to an aid package activated in May, Greece will get a total of 110 billion euros (145 billion dollars) from Eurogroup countries and the IMF over the next three years and as an exchange the country is requested to carry out harsh austerity programs to put its house in order. Greece received the first batch of loans on May 19.

Source: Xinhua


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