Another EU Task Force Descends on Greece



ATHENS – Already under the thumb of the EU-IMF-European Central Bank Troika which is requiring Greek Prime Minister George Papandreou to keep cutting workers pay, pensioners benefits and raising taxes as a condition of getting rescue loans to keep the country from going bankrupt, Greece now has a second European Union group acting as consultants, but its leader said he will not dictate what must be done to slash the $460 billion debt threatening to sink the country. Greece is getting by on a series of $152 billion bailout loans from the Troika, but Greeks have complained it, and not Papandreou, is really ruling the country.

German banker Horst Reichenbach is advising Greece on how to use EU funds

“The task force is here to help, not to control,” the group’s chief, Horst Reichebach, a German banker, told reporters here. The 25-member task force isn’t reviewing Greece’s books, but will advise on how Greece can use EU funds designed to jump-start growth and Reichenbach said it will focus on accelerating the deployment of EU monies to develop tourism, alternative energy and food processing projects and businesses.

Unlike the Troika, which effectively runs the country, the advisory tasks force will not issue any dictums, but will issue quarterly reports on how the country is advancing in its structural adjustment and give advice on how to get the country’s notorious tax evaders beating the state out of as much as $40 billion a year in lost revenue.

“Greece needs a better tax collection system and we will help to implement this,” he said. “The Greek authorities have already worked on this with the International Monetary Fund and there is a large degree of agreement.” He met with Papandreou and Deputy Prime Minister Theodoros Pangalos and joined other EU leaders praising Greece’s political will in implementing harsh austerity measures, although more independent financial analysts are more sceptical. “I’m convinced that by common efforts we can make progress to help Greece make it and there’s determination to do so on both the Greek and European sides,” he said. “There is enormous political will in Greece and political will at the European level to keep Greece in the Eurozone,” the 17 countries using the euro as a currency.

They’ll have a lot of work as new figures show employment as 16.3 percent, up 4.5 percent from the same period a year ago, while youth unemployment is said to be 32.9 percent, but other figures put it at as much as 40 percent, which has sent Greece’s young fleeing to other countries in search of work and a new life. Reichenbach said that while Greece faced “unique” reforms, he was also “impressed” by the government’s determination to enact changes that were long overdue, the British newspaper The Guardian reported. “I am very glad that at a European level there is the political will to keep Greece in the euro and have a good future for Greece in Europe,” he said.

Reichenbach, a former Vice-President at the European Bank for Reconstruction and Development, which has worked extensively in the former eastern bloc, said the task force, set up after Athens appealed for a second bailout of $157 billion in July, would “provide technical assistance … there are major infrastructure works that could have a huge employment impact.” He added that, “Money is not the big problem, money is available … the problem is to put it to good and effective use,” referring to under-utilitized EU funds.

“A good investor always looks for an opportunity and this (Greece) is a brilliant opportunity.” Finance Minister Evangelos Venizelos, who continues to spout optimistic assessments of Greece’s recovery, said nonetheless that the deep recession will last through next year, reversing previous predictions it would recover.

Many Greeks and other analysts think it will last a generation or more. The goal to reduce the deficit – which a year ago was about 15.4 percent – to 7.6 percent, will miss by a mile and now will likely top 9 percent, the government said, although some analysts said it could hover around 10 percent, meaning the austerity measures and bailouts will have failed.