According the Greece’s finance minister, the country’s worsening recession is likely to result in minimal to no growth next year. The European Union and International Monetary Fund have suspended a review in order to allow Athens to put additional efforts towards boosting growth.
The Eye of the Cyclone
“It’s important we leave the eye of the cyclone,” Evangelos Venizelos , Finance Minister, said recently. “The recession was a major subject of our discussions and it will be bigger than our partners had forecast.”
Venizelos then denied that talks with the EU, IMF and European Central Bank had buckled. “There wasn’t any change to the program,” he said.
According to both the EU and the IMF, Greece’s economy will likely be reduced by 3.8% this year. Venizelos has stated that no final predication has been confirmed, but the contraction will near 5% of output. The government will also aim to make the 2012 recession as minimal as possible.
Greece Must “Live Up to its Responsibilities”
Meanwhile, Angela Merkel, German Chancellor, has encouraged Greece to meet its budget-cutting commitments.
“For the German government, what counts is that Greece lives up to its responsibilities- to its own people and in terms of solidarity toward its European partners,” Merkel’s spokesperson Steffen Seibert said last week. “What’s important to us is that Greece implements the accords and responsibilities promptly and as quickly as possible.”