ΓΡΑΦΕΙΟ ΤΥΠΟΥ ΠΡΩΘΥΠΟΥΡΓΟΥ
Τρίτη, 17 Σεπτεμβρίου 2013
Barroso: Good afternoon Ladies and Gentlemen,
Prime Minister Samaras and I have just concluded a very constructive meeting, where we discussed the upcoming Greek presidency of the Council of Ministers, as well as developments in the Greek economy and the financial assistance program. I assured Prime Minister Samaras of the Commission’s support in the run-up to and during the Greek Presidency, in what will be the fifth time that Greece takes this very important leadership position. The Greek Presidency will play an important role in ensuring that key legislative files are taken forward in the Council in the first crucial six months of 2014.
We will work closely with you and your ministers, Prime Minister, on seeing through the remaining proposals on a Banking Union, to deliver a successful European Semester and to kick-start programs under the next seven-year budget – in particular, the Youth Employment initiative, which we will frontload from next year. So I really believe it’s critical when you speak about growth and investment to have in place all the programs. That is why we are working with the Council and the Parliament, and it will be indeed during the Greek presidency that we will have this possibility of having investments on the ground.
On the economy now: I want to say that I very much support Greece’s efforts in implementing the financial assistance program. Prime Minister Samaras has once again assured me of his clear commitment to see it through. The Commission continues to believe that this is essential to secure Greece’s future growth and jobs, and it is already giving positive results. I really want to congratulate you, Prime Minister, dear friend, for your leadership and determination. I believe it is key for the success of the program. I know that the Greek citizens are operating in extremely challenging and difficult circumstances, but I believe now we can say there is light at the end of the tunnel.
In fact, we expect a gradual return to growth in 2014 after six years of recession; government bond spreads haven fallen markedly since their peak in June 2012; economic sentiment has improved; the current account deficit has fallen over the last three years and Greece’s debt-to-GDP ratio is set to start declining next year and fall below 120% by 2021. All these are encouraging signals when you think of the doubts that were expressed some time ago concerning Greece.
But further work is needed to consolidate these gains. The economic situation is still fragile and this is not the time to take our hands off the wheel but to roll up our sleeves. Fiscal consolidation, of course, is necessary. Full implementation of the program is essential on this point in order to support the return of confidence and for the sake of growth and job creation.
Stepping up the pace of structural reform is also crucial. More work needs to be done to reform the tax system; this is not only about increasing revenues but ensuring social fairness. I think it’s critically important for the support of the citizens to see that the reforms are not only for competitiveness – as they should be – but also for social fairness. And when we discuss taxes this is, of course, critically important. We believe that there is still a way to go to modernize the public sector and really put it at the service of citizens and companies.
This kind of an economic transformation takes time and you know that in the short term it and can be painful. Extremely difficult, from a political point of view, and socially quite challenging. I want to assure the Greek people that the Commission continues to stand by you and we will do it also in the future, For example, we are developing support for unemployed young people or for start-up companies through the European Union budget.
Prime Minister, dear friend, a year ago the doomsayers were predicting that Greece would have to leave the euro. Through your leadership and the determination of the Greek people they have been proved wrong. Not only that, but we see, now, better signals for the future. And you will be taking on the responsibility of a Council Presidency of the European Union. I look forward to working with you at this decisive time for Europe. I know also your personal commitment to our European values and our European project.
In May, people will head to the polls to vote in the European Parliament elections, and it is very important that we make these elections a moment of European Democracy. And I’m sure that from now until then, we will make also progress in delivering concrete results. Some important decisions were taken by the European Council, by the institutions, by the governments, but we need to be sure that they are really implemented on the ground, including the most important ones, to tackle the dramatic issue of unemployment, namely, youth unemployment. That is why putting in place, on the ground, these programs, and also doing everything we can to start or restart the financing to the economy, namely to SMEs, is so critical at this moment. Once again, thank you for your visit. I believe we had a very good discussion and we remain of course, as always, in very close contact.
Thank you.
Antonis Samaras: Well, I want to thank my good friend President Barroso for his leadership and for his cooperation with Greece in order to tackle the problem of the crisis. It has been already made clear that we have discussed basically two issues. One, the economic progress in Greece and two, the preparation of my country for the Presidency starting the 1st of January 2014.
After six consecutive years of very deep, prolonged difficult recession, severe unemployment and a dramatic dropping living standards, Greece is now obviously reversing the trend.
During the past fifteen months we have put all the attention we could, all our energy in implementing structural reforms and fiscal consolidation and for the first time our middle of the year recession forecast is better than the initial one. And for the first time for many many years we are getting closer to a primary surplus.
According to the latest data by the Commission, the IMF, the OECD, Greece is currently producing the largest cyclically adjusted primary surplus and the largest structural surplus in the Euro zone.
The structural reforms have been implemented by over 75% and the competitiveness gap since the year 2000 has been fully covered.
This is been achieved with patience, dignity and persistence on the part of the Greek people, in order to come out stronger from this crisis.
And as the President has just indicated, it is true that over a year ago many many uncertainties about our immediate prospects in the Euro zone were heard all over the place but today there is no more talk about infamous “Grexit” and our recovery is considered imminent from next year.
Job creation and the return to long- term sustainable growth is obviously our top priority and Greece’s comeback will be signaled and will be underlined by the Greek Presidency. The preparation for this Presidency has started months ago, proceeds at full speed ahead, we are presenting a bold agenda of priorities which includes obviously what the President just said, growth, job, cohesion, investments, as you said, on the ground, the completion of the new EMU architecture, migration, boarders, mobility and an all encompassing in European Maritime Policy.
And the Greek Presidency is committed to work for more Democracy, transparency and accountability in the decision making process. We are looking for an effective cooperation with the European Commission and the European Parliament, as I said earlier, in order to deal with all persistent problems of our Union. A successful Presidency at the first year of our economic recovery will mark a “double return” for our country in a united and stronger Europe.
2014 is the year of the 8th Euro Elections, to be held in an obviously critical conjunction, our Presidency will work hard together with all our partners and the European Institutions to reverse the current trends, the answer to all current challenges is more growth and more Europe and above all clear determination to achieve our common goals. And I want to thank you very much, Mr. President, for this opportunity you have given me.
Journalist: My question has two parts, it is for the President of the Commission: I would like to ask you Mr. President, as far as we wait for the next review of the troika in Greece has already start the debate concerning the fiscal gap of the period 2015-2016. I would like to ask you if Greece is obliged to take additional adjustment measures, like cutting more salaries and pension and additional taxes. And the second part of my question concerns the financial gap. It is the gap for the year 2014-2015. I would like to ask you if Greece needs a new program for financial assistance, it means further conditionality, it means a new memorandum of understanding. Thank you very much.
Barroso: Thank you for your question. First of all, as you know, the new troika mission is already now arriving in Athens at expert level, the heads of the different teams are going to arrive this weekend. So, I have to wait for the report they made after having contacts, of course, with the Greek authorities. So, from a technical point of view to give us the full picture. I cannot at this stage speculate about what can be the next steps. What I can tell you now is that the current program is fully financed until mid 2014 and it is on track. The Greek authorities are showing strong commitment in implementing it and we are starting to see the first results of that commitment. Of course, we all know that for Greece the economic challenges have been extreme and it is no secret that we have to look again at Greece’s financing needs and any possible gaps. I am aware of all the speculation going on about this at the moment but I will not add to that speculation. I don’ t think it is useful. Nor do I want to pre-empt the results of the mission that is currently under way. Let’s come back to this when experts have done their economic analysis. But the word I want to give now to the Greek citizens is a word of confidence, is that in fact their efforts are paying off and that it is important to understand that it is not now that we should put in question the results achieved.
A great part of the issues regarding Greece and other countries and program has to do with confidence, with expectations. We have spoken about this with Prime Minister and myself. We have seen and we have seen in different countries that when there are doubts about the determination of the country, regarding implementation of the program, immediately there are consequences, in terms of market confidence, investors’ confidence.
On the positive side, when there are signals of clear determination and not only signals but also decisions, then this is rewarded, this is positively seen by the markets. I want to say this to you why? Because I think this is very important for the Greek citizens to understand that when the troika is going there- also some times with news that are not very pleasant to give- but it is there to support Greece. It is not the question of being nicer or not so nice. It is a question of designing with the Greek authorities and, of course, afterwards to have the support of the Eurogroup countries a program that is credible. And at the end, the markets trust and so, the investors are coming back. And they can create more growth in Greece and more exports in Greece and so on. And so, in the news and so are good from that point of view. It serves no purpose and it would be in fact a counterproductive if now the experts of the troika going to Athens, say “OK, now everything is OK, nothing is more necessary”. No, because even if they said that and if they did not solve the problem of confidence, then Greece will have to pay a higher price.
So, I want to make this point, because I know it’ s very sensitive. I know also in other countries that I’ m following very closely this is a critical issue but I really want to urge all those having responsibilities and I am thinking about the good for Greece to understand the need to complete the implementation of the program in a successful credible way. Let me just have one reason for hope. We are also discussing this now. Some time ago, Greece was one of the less good performers in terms of structural funds, one of the last in the least in terms of modelization of the structural funds. Now it’ s the forth. That was achieved, of course, with our support but thanks to the great reforms and commitments of the Prime Minister and the Greek administration.
So, people that are now in fact receiving less, because of the cuts in their salaries, are now showing great professionalism competence. Greece, I repeat, is the 4th country, between all the twenty eight in terms of good performance regarding the utilization of the structural funds. From the 1st of January 2014 there will be plenty of money for Greece. Greece negotiated a very good package, in a next European budget. So, let’s try to make the most of it, keep the good work but make the most of these funds for investment, addressing for instance some of the gaps in finance of real economy, the SMEs that are some of them struggling with a very difficult excess to capital and one of the key variable for growths is confidence. I’m giving you this very long answer because sometimes I believe it’s of course not putting the blame on anybody but some of these discussions, public discussions about financial gaps and so on can only distract us from what is needed to be done and can only increase the uncertainty at the moment when what we need is certainty. And I think now we have already sufficient record to say this will succeed. Of course the program has to be adopted. Of course it will be. But to make speculations now about the worst case scenario, I don’t think it is good.
And what I’ m saying I think it’s very strong because I remember when, also in this building, I was receiving many experts around the world, they were telling me that by the end of 2012 Greece would be already out of Europe. So they were wrong. Those speculations were counter protective and infect Greece has paid a price of that. Greek people have paid the price for that because all those analyses that were predicted the worst infectively increasing the interest rates that the Greek people have to pay. That’s why I think that it is very important that they manage expectations correctly and this is to be realistic to say yes, this has been done, this was good, this has to be done, let’s address the issue and I think only it is realistic the assessment that you can make progress and help Greece and the Greek citizens to get out of this situation because I believe they will succeed.
Samaras: Well, I want to agree very much with the President. I want to make sure I say that Greece is back on track. Actually, in some respects it is even better than targeted, both in terms of structural surplus as well as in terms of the less of the predicted recession that we are going through. Numbers- in other words- have been revised upwards. This means what? It means that the sacrifices of the Greek people are producing tangible results. And I also want to mention that according to last year’s November 27th Eurogroup decision if Greece indeed achieves its targets regarding the primary surplus, then obviously the structural reforms we are going through, then all temporary funding problems- because you’ ve asked about this also- will be taken care of. And so, we are achieving our targets.
So, I have to agree that all this talk about the need for extra financing of Greece has to be along the lines of last year’ s agreement. Not because Greece has failed, but because Greece has been successful this time around. And therefore, it requires the helping of our allies. And then, more specifically, I want to tell you that concerning the fiscal gap for the years 2015 and 2016, we have already agreed to take steps and cover any perspective fiscal gap of the order that has already been mentioned by us and the troika and the past of two and the half billion. The agreement holds. We will see with the new discussions the exact numbers and again what we have to do is not any additional austerity measures but structural reforms with positive fiscal impact. And therefore, that’ s what we intend to do on our side, which is stick with our targets. And this is what we have been doing and I repeat again, sometimes we go even better that targeted.
Journalist: A question in response to what Prime Minister Samaras said, for both of you I suppose. Prime Minister, you’ ve spoken about no additional austerity but really stick into the structural reform targets and you’ ve spoken about how Greece has in some respects over-performed and surprised positively in terms of the fiscal front. Is it your feeling that there is no social, financial and indeed political space for additional cuts on top of what’ s already been predicted and agreed on for the current year and 2014 as you go into the budget process in October. Did you discuss this with President Barroso? I mean, additional fiscal measures for this period and the new year over and above what’ s already been agreed. And President, Mr. Samaras has been stressing a new focus and a further focus on structural reforms. Do you see any willingness on the Commission and the further Euro zone partners to go a little easier on Greece, given its good performance in the fiscal front and focus instead on structural reforms. Would you, therefore, be prepared to cut Greece some slack on fiscal measures and make sure that there is more attention paid to pushing through some structural reforms?
Samaras: I do not want to add anything more to what I said before in answer to your question. I think I’ ve answered it already. What we are basically doing is fiscal consolidation, structural reforms that are necessary, we are going through, we are on target, we expect obviously our allies to perform accordingly in terms of what is already been announced from the Eurogroup decision on last November. So, this is where we are. I am not trying to play it over-optimistic and just calling it as it is. And I am just saying the facts as they are and I believe that these are a good solid basis for Greece to try and perform even better in the future. And this would be, I repeat, a very positive signal for us when we will be taking over the European Presidency and it will be a double score for Greece.
Barroso: I am already on record saying that a policy only of fiscal consolidation has its limits. Political and social limits. That’ s why it is important to understand that the policy we are implementing in Greece and other program countries is not just focused on fiscal consolidation. It’ s also about structural reforms and also about investment, namely investment to support the poorest in the society and including the biggest issue that is I think the issue of unemployment, namely unemployment of young people. So, it’ s a caricature to present European Union policies agreed by European institutions and the member-states, because it’ s not just of the institutions, it was agreed unanimously by the member-states to present it as centered in fiscal consolidation only or alone. It’ s also about structural reform and about investment. And that’ s why I’ve mentioned before the importance of structural funds, if they are properly managed and implemented.
Now, even in fiscal consolidation what we have been proposing and we’ll keep proposing is what we have called growth- friendly fiscal consolidation. So, we are, for instance, advocating even for Greece stronger social safety nets. For instance, support for those that don’ t have else insurance. So, we believe that yes, a country like Greece and other program countries has to frontload a fiscal adjustment. Let’ s not forget where we were two or three years ago. If there was not the frontloading of the fiscal adjustment, simply these countries would be completely out of the market and there would be no credibility also to ask for the other countries to make the loans to those countries. So, we were very close to insolvency in those countries. That’s the reality. We have to face it. So, the frontload of the fiscal adjustment was not an option. It was the only way forward. Of course, we have not advocated for all countries in European Union. We have said that the time that for instance countries surplus could do more to rebalance their internal demand. This isn’ t proper, because sometimes people say also that this is a one side fiscal approach. It’ s not true. So, we have argued for frontloading the fiscal adjustment but as much as possible try to protect some expenditure, not only the expenditure that can do the right growth in future but also some targeted expenditure.
Now, when it comes to fiscal consolidation, for instance, reducing public services that is too big. That is sometimes called austerity. I call it efficiency and I call it a social measure. Because you cannot have the people of countries that are in such a difficult, dramatic situation be paying with their taxes for this kind of public service. So, to reduce the public service, the dimension of the state administration to make it leaner, to make it lighter while keeping as much as possible the quality of public services, this is a good social policy. The same kind tax reform. When I speak about taxes, it’ s not just collect more taxes. It’ s to have more people paying taxes, reduce tax invasion and tax fraud, to insure the largest basis of contribution. Because that is of critical area for fairness. Of course, Greek people are angry and they are rightly angry when they discover that many people, including some of the wealthiest were not paying taxes at all. That’ s the reality. They will be ready to make sacrifices if they see that they are more fair distributed. So, this is also important. We are not advocating fiscal consolidation for the sake of fiscal consolidation but what I call smart fiscal consolidation. Another example is labour market reforms. Of course, it may seem difficult but there is critical important to have more young people in the market. Because if the labor market is not reformed, what happens is that the companies, namely small and medium size companies are not hiring young people. So, yes, artificially protecting jobs that some times are not competitive or sustainable and you are condemning the new generation to be in unemployment. Once again, it is citizen friendly and workers friendly and social friendly. A policy that promotes market labour reform. Finally, as I have already mentioned should the taskforce for Greece and other instruments, we are doing the best to increase the support of European budget, to support the Greek authorities to provide target training programs mainly for young people. So, I believe this is good a signal, a good demonstration that we are not exclusively focusing on fiscal consolidation, that even fiscal consolidation there is some margin to see what are there is we can and should cut and others where we could not cut or could even put some more money to protect the most vulnerable an also that yes, I agree with the part you made your question that the critical issue now is structural reform. By and large, we can say that Greece has been very very courageous in this track of fiscal consolidation’s efforts. If you compare with other countries, it has made a huge effort. Some will think it would not be possible, it was done. But in terms of structural reforms let’s be also honest, they started sometimes late. There were previous some political problems that created some doubts and for instance the privatization program also took some time to be implemented.
I discussed this very frankly and openly undoubtedly, as always with my good friend Prime Minister Samaras and I think we have agreed that more emphasis has to be put in the structural reforms and also on speeding the privatization program that it one of the ways also to address any possible financial gap, if there is. Because if you have more reseeds, more revenues from these sources, you can address without imposing on your citizens additional sacrifices. But these matters have to be dealt with a technical level and I know that you are very competent let’s say staff there together with European Central Bank and also with IMF and, of course, with the Greek authorities that are putting the best of their people in that area so, that you can after comprehensive assessment now it is reduced. See what is the best way for it and I cannot now anticipate what is going to be exactly in next steps.
