Global Biz

Greece discusses fiscal plan, lenders' pressure up

(Agencies)
Updated: 2011-05-23 08:56

ATHENS - Greek Prime Minister George Papandreou will discuss new measures with his cabinet on Monday to cut the budget deficit, in an effort to convince lenders Greece can deal with a debt crisis without a restructuring.

At stake is a 12-billion euro aid tranche under the EU/IMF bailout agreed last year, as well as additional help needed as the country is not expected to return to bond markets in 2012.

Related readings:  Direct flights to further Greece-China ties  Greece braces for new general strike

Papandreou vowed to speed up reforms and do everything it takes to avoid default, setting the stage for the announcement of a tough set of measures.

"Greece must convince everyone, beyond any doubt, of its determination," he said in an interview in Sunday newspaper To Ethnos.

The mid-term fiscal and privatisation plan is part of an ongoing EU/IMF inspection visit, described by Greek officials as the toughest review to date of Athens' progress in its 110 billion euro bailout.

The cabinet will have an initial discussion on the plan on Monday. Papandreou will then consult with opposition party leaders on Tuesday. Further talks with EU/IMF inspectors are scheduled later in the week.

EU leaders are growing impatient with Greece's fiscal slippages and expect to get convincing answers in the new four-year plan which aims to wipe out the budget deficit and raise 50 billion euros ($70.78 billion) from privatisations.