He made the comments following a visit by European Union inspectors, who delivered a grim assessment of the Greek economy. Mr Papandreou said that the previous Conservative administration had "fled from its responsibilities", understating the budget deficit by half. "The damage is incalculable. It is not only financial or fiscal but also affects the position of the state," he said. "Our duty today is to forget about the political cost and think only about the survival of our country. Past policies make it necessary to proceed to brutal changes and reduce accumulated privileges." Mr Papandreou announced that he would meet Angela Merkel, the German Chancellor, next week, amid growing signs that diplomatic efforts are underway to find a solution to Greece's problems. He also met Josef Ackermann, Deutsche Bank's chief executive. However, the Greek prime minister insisted that his country would find a solution to its financial problems. "We ask the EU for its solidarity and they ask us to meet our obligations. We will meet our obligations ... we will demand European community solidarity and I believe we will get it," he said. "No other country will pay for our debts," he said. "It is a matter of honour and pride for our country to put our own house in order." Greece's debt problems have put pressure on the euro and have triggered jitters in world markets, as fears that the country will default on its debt persist, which would potentially destabilise a global recovery. In a sign of how much of an impact Greece's problems are having elsewhere, Mr Papandreou will also meet President Barack Obama. Concern over Greece has been mounting since the government warned the deficit is running at 12.7pc of gross domestic product, far above the European Union's 3pc limit. Moody's has warned that Greece is at risk of a "slow death" unless it sharply reduces its deficit, as higher debt costs cause the economy's economic potential to diminish. Mr Papandreou said on Friday: "There is only one dilemma: Will we let the country go bankrupt or will we react? Will we let the speculators strangle us, or will we take our fate in our own hands? "We must do whatever we can now to address the immediate dangers today. Tomorrow it will be too late, and the consequences will be much more dire," he added. Analysts at Credit Suisse have predicted that Greece's debt to gross domestic product ratio will peak at around 130pc in 2012-13 from an estimated 113pc in 2009. That compares with the Greek's government forecast of a 120pc peak in 2011.Greece's 'worst fears' confirmed, says PM George Papandreou
The Greek Prime Minister, George Papandreou, told parliament on Friday that the worst fears about Greece's economy had been confirmed.
Sunday, 28 February 2010
Posts
