There will be no new austerity measures as long as Greece was “doing well” with regard to the targets of the memorandum for the European financial support package, Prime Minister George Papandreou assured reporters during a press conference on the sidelines of the annual Thessaloniki International Fair on Sunday.
“We either change Greece or condemn it” he repeated in statements to reporters. He stressed the need to stop constant speculation in the media about probable additional measures and thus generating fear and panic.
The process foreseen by the memorandum comes to an end in 2013 and the sooner the changes were made, the sooner Greece will be free of the restrictions of the Memorandum. Additionally he added that this could possibly occur even before 2013.
The prime minister stressed that his government had successfully changed the country’s course and averted a disaster during its 11 months in power, saying that Greece had been saved from defaulting on its debts. At the same time he stressed that the alert was not yet over.
Noting that there were still problems with the size of state revenues, Papandreou claimed that these were not insuperable and that the government was still on track to meet its target of reducing the deficit by 40% by the end of the year.
The prime minister denied reports that the shortfall in revenue was around 3.5 billion euros saying that the actual figure was closer to 1.5 billion euros.
On the reaction of international markets where spreads for Greek bonds were still steadily increasing, he appeared confident that the measures taken by the government would soon result in a positive response. He believes that spreads will fall since Greece had shown itself: “capable of tackling problems…generated confidence, that is rising”.
He also underlined once again that there was no question of Greece defaulting on its debts, stressing that such a course of action would be disastrous for the economy and the country’s future. Avoiding this outcome was the reason for everything the government had done over the past 11 months he added.
Another point emphasised by the prime minister was the need for all Greeks to pay their taxes and contributions in order for the country to thrive. He noted that the government was doing its utmost to expand the tax base and ensure that those who should pay actually did so. He pointed out that if people had been honest about paying their taxes the austerity measures would not have been necessary.
Papandreou described tax evasion as a: “chronic illness faced by the state that had to finally be tackled through major changes”.
“It is important to change the taxation mechanism and this is one of our priorities,” he said. Papandreou stressed that it was time for the rich to start paying. He said the government had launched a relentless hunt of major tax evaders that had taken refuge in tax havens abroad, initiating proceedings to obtain information from foreign banks as well.
Concerning the tax breaks for businesses announced by the government, with a reduction of their tax from 24% to 20%, he was careful to clarify that the reductions were for funds that were reinvested and used to create new jobs rather than those that went into company owners’ pockets.
“The money is there, the question is where it goes,” Papandreou said, echoing his much criticised statements in the race to the 2009 general elections that there is money. Pointing out that more than one million Greeks currently had tax issues that were still open he said the government would ensure that all the cases were closed cleanly and fairly, with the aim of expanding the tax base and ensuring that everyone paid their dues.
In another appeal to the media he asked that journalists to be careful not to present proposals or ideas under discussion as impending decisions and in this way demonising ideas and the exchange of opinions.
With a call for collective effort and responsibility,Papandreou underlined that the work of reforming the country had begun and stressed that the challenge before Greece was: “patriotic and not party politics”.
“We either win together or we sink” he emphasized adding that if all Greeks worked together the country would prevail.
Answering more specific questions, Papandreou said that a system for equating taxes for heating oil and diesel used by vehicles would not go into effect until a redistribution mechanism was ready.
Concerning the much larger cabinet created under the new reshuffle – in contrast to the much “leaner” cabinet appointed when PASOK was first elected to power – Papandreou said that the previous government had done well but that there was still room for improvement. He said the extra ministers were necessary in order to speed up control and supervision of the government’s priorities.
The prime minister denied any plans to relocate to some official position in the European Union or United Nations, stressing that he did not intend to stand down.
“I have taken charge in tough times and I will not shy away. This is where I have promised to be and this is where I will stay” he stressed.
Parties strongly criticise PM:
The prime minister’s appearances at The Thessaloniki International Fair had only served to increase concern and confusion about the fate of Greece, main opposition New Democracy spokesman Panos Panagiotopoulos said on Sunday. His comments were in regard to the prime minister’s speech and press conference.
“One year after his false claims that ‘the money is there’ the prime minister has succeeded, in spite of his attempts to reassure us, to make us even more worried through the confusion, contradictions, inaccuracies and gaps in his statements” the spokesman said.
According to the Communist Party of Greece (KKE), the prime minister’s claims concerning “necessary” and “patriotic” changes were lies since the same barbaric measures were being imposed on peoples throughout the EU, with the same tragic results for people and “no cure for over-aged capitalism”.
Popular Orthodox Rally (LAOS) spokesman Kostis Aivaliotis was stinging in his criticism, saying the prime minister’s press conference was “without substance, verve or result” and that it made “obvious the prime minister’s inability to answer the questions that concern the country”.