Greek Prime Minister George Papandreou expressed on Friday his government’s determination to step up structural reforms to solve the country’s economic crisis. He started discussion on the imminent restructure of debt ridden and unprofitable Greek Railways.
“We are here to do work,” said Papandreou chairing the first meeting of his new cabinet after this week’s reshuffle in the northern Greek city of Thessaloniki, where the 75th Thessaloniki International Fair opens on Saturday.
“Over the past 11 months we kept hope alive thanks to the sacrifices of Greek people, but the way forward is long. The alarm has not gone off,” stressed the Greek leader referring to the danger of default, before announcing the creation of two government committees which will focus on development and social policy issues.
Burdened with an enormous budget deficit Greece reached the brink of bankruptcy this spring . The financial support of European partners and The International Monetary Fund now implements a drastic austerity program to return to the path of economic growth by 2014.
Greece dropped to the 83rd place in the global competitiveness index of the World Economic Forum this year, down from 71st in 2009 according to the latest data.
Aiming for a fast recovery, Papandreou’s socialist government pledged a string of bold reforms including the restructuring of Greek Railways which topped the agenda of the cabinet’s Friday meeting. The draft bill on the partial privatization of the state company was approved by the cabinet on Friday and is expected to be discussed in parliament and be ratified in October.
Greek Railways lose at least one billion euros (1.27 billion U. S. dollars) per year and the current debt reaches 10 billion euros (11.27 billion U.S. dollars).
According to the government’s plan almost one in two job positions of the current 6,000 posts will be cut. Transport Minister Dimitris Reppas stressed that they will be no layoffs, but employees will be removed to other state agencies. There will be cutbacks on services offered and an increase to prices of tickets.
The idea has caused strong reactions by labour unions which staged a series of small demonstrations in Thessaloniki on Friday against cutbacks on salaries, tax hikes and such reforms, as the cabinet convened.
A bigger turnout of thousands of protesters is expected on Saturday, as Papandreou will officially inaugurate the city’s trade fair and deliver a keynote speech on the economy.
At least 4,500 policemen are on alert as minor scuffles between demonstrators and police were reported on Friday. Similar protests in Athens this year have turned violent. On May 5th three bank employees died when hooded protesters torched a bank branch near the Parliament building during a massive rally.
This year’s Exhibition in Thessaloniki focuses on innovation and green development and runs until Sept. 19th. Hungary is the honorary country among 16 official state participations. At least 250,000 people are expected to visit the stands of 1,041 exhibitors, which has increased from 915 last year.
In the context of fiscal discipline to face the crisis, the cost of participation of Greece to the fair was decreased by 20% compared to last year’s budget, Greek officials noted.
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