Greece can make it with agreed reform plan-euro zone

By Jan Strupczewski

BRUSSELS (Reuters) – Greece will be able to return to fiscal sustainability if it strictly implements economic and financial policies agreed with the EU, the IMF and the European Central Bank, euro zone finance ministers said in a statement.

The statement follows discussion by ministers from the 17 countries using the euro, called the Eurogroup, on the conclusions of a report on Greece by a mission of the International Monetary Fund, the ECB and the European Commission, called the Troika.

“A Eurogroup conference call took place this afternoon to exchange views on the assessment of the Troika following the conclusion of its fourth review mission to Greece,” the statement said.

“The Eurogroup welcomed the staff-level agreement with the Greek authorities on a set of economic and financial policies needed to meet the program objectives,” the statement said.

“We share the view expressed by the Troika that strict implementation will help restore fiscal sustainability, safeguard financial stability and boost competitiveness,” it said.

The ministers, under the chairmanship of Luxembourg Prime Minister Jean-Claude Juncker, noted Greece made significant progress in cutting its budget deficit so far, but said more was needed.

“A reinvigoration of fiscal and broader structural reforms remains necessary,” the statement said.

The euro zone ministers also welcomed the Greek government’s commitment to its privatisation program, under which Athens is to raise 50 billion euros by 2015 – a key element in its efforts to service debt obligations.

The ministers also stressed that all political parties in Greece should support the reform program.

“The adjustment of the Greek economy can only succeed when all relevant political parties subscribe to the objectives and main parameters of the program,” the statement said.

The ministers had “a first exchange of views on the financing modalities for Greece’s adjustment program,” but gave no details.

The European Union and the IMF are discussing a second bailout program for Greece as it became clear that the country will not be able to return to markets in March 2012 as originally planned and is therefore short on financing before its reforms pay off. (Reporting by Jan Strupczewski, editing by Andrew Hay)