‘Greece needs additional cuts’

A top European Central Bank (ECB) official says recession-ravaged Greece needs to impose additional austerity measures, including cuts in spending, to help reduce the public deficit and meet the targets set by its international creditors.

In a Monday statement, ECB executive board member Jorg Asmussen, also said that œFirst and foremost [it] is important that [Greece] will close the significant fiscal gap that is there for next year.”

Meanwhile, on the same day, Greek Finance Minister Yannis Stournaras rejected Asmussen™s claim with regard to a œsignificant fiscal gap” in the country’s 2014 budget.

The Greek economy is in its sixth year of recession due to fiscal mismanagement, resulting in tax rises and spending cuts.

Greece has been dependent on bailout funds from international rescue loans approved by the so-called troika of international lenders – the European Union (EU), the European Central Bank (ECB), and the International Monetary Fund (IMF) – since May 2010.

The international lenders estimate that Athens will be in need of nearly 10-11 billion euros from the second half of 2014. However, several eurozone governments are unwilling to grant further loans due to negative public opinion.

The country has witnessed three years of austerity policies imposed by the government in a bid to win bailout loans from the international creditors.

In August, Greek officials said a new aid package is necessary to plug any funding shortfall over 2014-2016.

By the end of 2013, some 25,000 civil servants must be redeployed and an additional 4,000 fired under the terms of the recent bailout package between the government and its international creditors.

Nearly one in every four Greek workers is unemployed; banks are in a shaky position, and pensions and salaries have been severely slashed.

Europe plunged into financial crisis in early 2008. The worsening debt crisis has forced the EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries.


Copyright: Press TV