Greece to meet deficit goal, no need for loan extension

ATHENS (BestGrowthStock) – Greece will meet its target to cut its budget deficit to 7.6 percent next year and will not need to extend the repayment of a multibillion EU/IMF loan, its finance minister told a Greek newspaper published on Saturday.

George Papaconstantinou said the country was sticking to a deficit target of 7.6 percent of GDP agreed with the EU and IMF under a 110 billion euro ($153.1 billion) bailout in May and that it would meet this target despite a revision of past Greek budget data by Eurostat due by mid-November.

“Our target for 2011 is a deficit of 7.6 percent of GDP or 17 billion euros and this stands no matter where we start from in 2009 and 2010,” Papaconstantinou said in an interview with Imerisia newspaper.

He said Greece will not need to extend the repayments of its multi-billion EU/IMF loans because fiscal conditions will improve as of 2012.

Analysts have said it was likely the country would eventually need additional help because of a jump in gross 2014/2015 borrowing needs when the multi-billion euro bailout expires.

“The deficit will be cut, we will have a primary surplus which will cover part of our debt-servicing needs and we will have a positive growth,” Papaconstantinou said.

“Regaining confidence the soonest possible is the only solution to what today appears as an impasse.”

EU statistics office Eurostat said last week it would revise upwards Greece’s budget deficit and public debt figures for 2006-2009 by mid-November and Papaconstantinou was confident this would put an end to long-standing uncertainties over reported Greek statistical data.

Greek officials have hinted that Eurostat’s revision could bring the 2009 budget deficit to about 15 percent of GDP, while local media speculate the revision could go to as much as 16 percent.

(Reporting by Angeliki Koutantou; Editing by Sugita Katyal)

Greece to meet deficit goal, no need for loan extension