After many months of crisis, the conditions now exist to start moving from crisis to growth in Greece. Agreement on the Second Economic Adjustment Programme and the success of the debt reduction agreement with the private sector mean that all efforts can now be concentrated on much needed growth and jobs.
Today the Commission has set out the reasons why it believes Greece can transform itself – through the implementation of the agreed adjustment programme and with the ongoing support and solidarity of the EU, channelled by the Commission. In a new Communication the Commission highlights the steps that need to be taken during 2012, as part of the programme and explains the huge range of support measures that it can mobilise to help Greece begin to generate new economic dynamism, job creation and social cohesion.
President Barroso said: "The people of Greece do not stand alone in their efforts to return the country to growth and jobs. The EU and the wider international community have shown solidarity with the people of Greece on an unprecedented scale. A package of grants, loans and debt forgiveness amounting to € 380 billion has been mobilised to help Greece. The sacrifices being made by the Greek people will bring rewards in the near future as Greece embraces the priority actions for 2012 identified by the Commission today. "
The Communication also outlines the impact of the crisis on Greece, gives details of the financial support from the EU budget and the technical assistance provided and explains how key EU policies help to support growth and jobs in Greece.
The European Union is helping Greece in financial and practical terms. EU funding for the period 2007-2013 amounts to €40 billion. The debt write-down of the private sector is €100 billion and financial assistance from the EU and international partners amounts to €240 billion. This equates to €33 600 per Greek inhabitant. Or 177% of Greek GDP.
The Second Economic Adjustment Programme must be delivered in full. It is a multi annual programme and will take time to deliver its full impact. In today's Communication the Commission highlights three broad areas where action taken by the Greek authorities during 2012, as part of the programme, can be expected to show promising results by the end of 2012. These are:
Getting control over public finances and revenues so that public finances become sustainable over time;
Getting lending flowing to the real economy by recapitalising the banks and helping SMEs to get affordable loans;
Freeing business to drive growth- a major overhaul of the business environment is urgently needed so that Greece becomes once again a place where domestic and foreign investors have confidence to invest and create jobs.
The Communication provides detail on how EU funds will be used to provide loans and guarantees for SMEs in Greece (€ 4 billion is available) and the EU has changes its own rules to make them more flexible and easier to apply in the current conditions in Greece. It describes measures need to free Greek business to drive growth, for example by facilitating and promoting exports, modernising and simplifying the regulatory environment, preparing state owned companies for privatisation and modernising sectors like energy and transport.
The Communication also explains how the Commission will work with the Greek authorities to tackle the social impact of the crisis. The Second Economic Adjustment Programme has been designed to protect support for the vulnerable, for example by ensuring that reductions in pensions are targeted and protect those on the smallest pensions, by fighting fraud in social benefits, by reducing the costs of health care without endangering the quality of care and by increasing the fairness of the tax system. The Commission is working closely with the Greek authorities to help the young unemployed through helping them get work experience, expanding apprenticeships, promoting youth entrepreneurship and also by supporting periods of study and training in other EU Member States. EU Structural Funds are supporting temporary economic relief for disadvantaged groups. These measures will accompany the modernisation of the Greek labour market as part of restoring the cost competitiveness of Greece.
The modernisation and reform of the Greek public administration is also a crucial part of transforming Greece and giving it a more dynamic, fairer and more socially cohesive future. In key areas such as tax administration and collection, land registry, judicial reform, local government restructuring and pubic administration reform the Communication outlines where the Commission will provide technical assistance and financial support through its dedicated Task Force for Greece;
For more information:
MEMO/12/255 Growth and jobs for Greece – FAQ