Hardouvelis: The country will not roll back to uncertainty

Greek Finance Minister Gikas Hardouvelis on Thursday said there was “significant progress” in negotiations with the troika in Paris. During a speech on the 2015 budget in Parliament’s Economics Commission, the Greek Finance minister said that “in a negotiation you cannot exactly say where you are and where the others stand, you don’t want to show your strategy. The only thing I can say is that we are doing a hard negotiation. The fact that we sat down until four-and-a-half in the morning in Paris is evidence of this.”

Hardouvelis reassured that “the country will not roll back to uncertainty. We are working hard in negotiations with lenders to avoid this uncertainty. There is significant progress in negotiations, there is agreement on a series of issues and we continue negotiations with fully documented arguments and I believe we will achieve a future will fewer burdens and more prospects for everyone”.

Hardouvelis, commenting on the provisions of the 2015 budget, said it signaled the completion of a big effort made by Greek citizens and the results “confirmed that there is a commitment in the country to fiscal policy,” adding that the challenge from now on was creating the necessary growth conditions with crucial factors such as political stability and focused reforms. “The economy is changing chapter and we leave the difficult years behind,” Hardouvelis said, adding that “the big difficulties, the bad situation, I think they are over.”

“In 2015 we will be able to cover all state spending – including interest – without resorting to new borrowing, which signals that the country approaches its fiscal independence, while the government will continue restoring injusticies and lowering tax burdens on the level it can afford,” the Greek Finance minister said.

Responding to opposition parties’ criticism on the reduction of social spending, Hardouvelis reassured that “this will change someday, but first the country must stand on its own two feet”. He noted that the 2015 budget will be executed as planned leading to the achievement of high primary surplus for the third successive year, based on a rational spending cut, combating tax evasion, boosting revenues and improving tax collection mechanisms.

He stressed that the key to achieve a 2.9 pct GDP growth rate was an expected 11.7 pct increase in investments, a 5.2 pct rise in exports and a 6.0 pct increase in private consumption. Higher revenues “will come from higher taxation but from economic growth”, he said.

“We hope that Greek banks will return to their traditional role, lending to enterprises, following their recapitalisation. And because money will be injected in the market, liquidity will be boosted and the state will also benefit,” Hardouvelis said.