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Support for Greece - 19/03/2012

View overlooking Athens towards the sea © istock/Yuliya Kryzhevska

EU provides hands-on expertise to help Greece return its economy to growth and job creation.

Early in 2010, rising government debt and budget deficits triggered a crisis of confidence in the euro. The market turmoil centred on Greece, which investors believed was in danger of defaulting on its unsustainable debt.

To help Greece, eurozone countries and the IMF put together a €110bn emergency loan package for the country in May 2010. The package was conditional on the Greek government continuing to reform public finances and economic policies.

Faced with this challenge, Greece asked the Commission for support, so it set up a team of experts tasked with helping the government implement the reforms. The aim? Returning the country’s economy to growth and creating jobs.

This help is crucial to keeping the reforms on track and helped the country secure a second round of financial assistance last week.

Teamwork

One of the experts’ main tasks was to ensure that EU support funds – separate from the bailout, and currently one of Greece’s only sources of growth financing – are better targeted.

The experts have helped Greece refocus a large part of this money on 181 high-impact projects, according to the team’s most recent report These include 5 motorway construction projects with a potential to create up to 30 000 jobs, and support for small businesses in need of credit.

The experts have also helped make tax administration more effective. The government has collected €946m in tax arrears, more than double the initial target.

They also provide expertise on streamlining public administration, both centrally and locally. This includes removing red tape in key business sectors.

A lot remains to be done. For example, the team is working on speeding up customs controls – goods currently take double the time required than in the rest of the EU to clear customs. Faster clearance reduces costs to businesses.

Further backing for Greece will come in the form of proposals from Commission president José Manuel Barroso on boosting growth.

More on the Commission task force for Greece

More on the Greek economy

EU response to the economic crisis

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