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GreekReporter.comGreek NewsEconomyIMF: Greece Might Need More Measures to Cover Primary Deficit

IMF: Greece Might Need More Measures to Cover Primary Deficit

imfGreece might need additional measures as 2015 will end with an estimated 0.5 percent primary deficit instead of the required 0.25 percent, says an International Monetary Fund report.
According to the recent Fiscal Monitor, an IMF reportĀ on international economy, Greece might need new measures worth 1.35 billion euros to cover the difference between the 0.5 percent primary deficit for 2015 and the 0.25 percent required by the country’s bailout program.
Furthermore, the report shows that state debt in 2016 is estimated to be 206.6 percent of GDP, against 196.9 percent in 2015. According to the lenders estimates, the debt to GDP ratio for 2016 would be 200.9 percent.
More pension cuts might be needed
The IMF report shows that Greece is the only country where so many pension reforms were implemented in the 2011-2014 period: retirement age increased,Ā stricter rules were put on early retirement and progressive reductions in pensions were introduced.
The IMF predicts that under the pressure of the commitments undertaken by Greece in the third bailout program, expenditures on pensions and healthcare will continue to shrink, despite the aging of the population.
According to forecasts of the organization,Ā expenditure on pensions in Greece is expected to increase at an average rate of 0.5 percent of GDP in the years 2015-2050, when the average growth in 35 developed economies will be 1 percent of GDP when the average in developing economies will move to 1.8 percent of GDP.
Expenditure on healthcare in Greece is expected to increase at an average rate of 0.8 percent of GDP in the years 2015-2050, when the average growth in 35 advanced economies will be 3.1 percent of GDP, and the average in developing economies will move to 1.2 percent of GDP.
The change of healthcare expenditure in Greece in terms of net present value will move to 37.2 percent of GDP in the period 2015-2050, when in 35 developed economies will be at 105.6 percent of GDP, and in developing economies at 43.2 percent of GDP.

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