Tags: Greece | deficit | cost | cuts

Greece Says It Met Deficit-Cutting Targets in 2012

Monday, 04 Feb 2013 12:17 PM

 

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The Greek government says its painful austerity drive is paying off, with the budget deficit reduced to 6.6 percent of annual output in 2012 from 9.4 percent a year earlier.

A finance ministry statement Monday said that, not counting the cost of servicing Greece's debt mountain, the government posted a modest budget surplus of 434 million euros ($588 million) last year.

"These positive developments ... show that efforts at fiscal adjustment and discipline are bearing fruit, which creates the necessary conditions to stabilize and gradually restart the economy," Deputy Finance Minister Christos Staikouras said.

The conservative-led governing coalition has promised to reduce the budget deficit to 5.2 percent of annual output this year — down from a peak of more than 15 percent when the Greek economy started to implode in 2009.

Greece is surviving on international rescue loans, granted since 2010 in exchange for harsh fiscal discipline through repeated cuts in pensions and salaries, coupled with tax hikes.

The deeply resented austerity plunged the country deeper into a recession, now in its sixth year, amid record-high unemployment that has seen about 1,000 private sector jobs lost daily since 2009.

The government has said it hopes to stem the recession later this year, forecasting a return to growth in 2014.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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