Primary budget surplus for 2016 expected to reach 2 pct, Fiscal Policy GenSec tells ‘Naftemporiki’

The Greek state budget primary surplus will significantly surpass targets in 2016, approaching 2.0 pct from an initial target of 0.5 pct envisaged under the economic policy programme, Fragkiskos Koutentakis, General Secretary of Fiscal Policy said in an interview with “Naftemporiki” daily financial newspaper.

Koutentakis said that this development was setting new more positive data in the development of fiscal figures not only in 2016 but in the coming years as well. “We will have to wait for the figures from the general government to have a more clear view of the result. But we do not expect any negative surprise, which means that the primary surplus could reach around 2.0 pct. The final verdict of course belongs to Hellenic Statistical Authority and Eurostat which will announce the official result under the prevailing methodology,” he noted.

“We have no reason to expect a worsening next year so it is possible to see revenues surpassing targets again in 2017,” Koutentakis said, adding that a significant part of 2016 performance was of a permanent nature, which means that the 2018 gap was reducing. “This is what elementary economic rationale dictates and I hope that the institutions will accept it. It is incomprehensible that they insist on a fiscal gap and demand additional measures when all official figures show exactly the opposite. I hope this time they will not ignore reality and will review their forecasts,” he said.

Commenting on the risk of a big delay in concluding the second review, Koutentakis said: “I do not think it is possible to have such a long delay, unless some of the creditors wish to undermine the government and the programme. In such a case, I would worry more about the impact on the real economy and less about cash needs.”

“Voting precautionary fiscal measures for 2019 was an unprecedented political demand which obviously surpassed what has been agreed and does not serve any fundamental necessity.

In any case, the government deals with this situation calmly and negotiates to find a mutually acceptable solution. I am optimistic that such a solution will be found soon, for the benefit of Greek citizens and to save any political decency left to European institutions,” he noted.