Greece told to start selling assets
Pressure from the EU and IMF keeps building to kick-start sell-off plan; ministry appoints advisers
Greece needs to quickly step up the pace of reforms to its economy if the European Union-led program isn’t to run off track, Poul Thomsen, head of the International Monetary Fund’s Greek mission, said yesterday.
“The Greek program has largely achieved what it set out to do,” Thomsen said at a conference. “It won’t remain on track without reinvigoration of structural reforms. Without this it will run off track.”
Thomsen said he expected the economy would shrink about 1 percent more than expected this year and that an acceleration of structural reforms in the public sector, among others, was needed to keep the deficit down. “Without this acceleration, the deficit won’t be much below 10 percent in 2011,” he said. Regarding Greece’s 50-billion-euro privatization prgram, Thomsen said that Greece needs to pick up the pace. “Privatization makes a real difference. If targets can be met, it will make change to debt sustainability.”
Thomsen said the fact that Greece may not be able to tap markets for funding early next year, as planned under the EU-led bailout, “reflects developments that are external to Greece.”
“Now, with accelerated reform and clarity on the European mechanism, spreads will come down but maybe not by early next year,” he said.
His comments came after renewed pressure on Athens from European Union leaders to sell off prized assets if the country wants to seek additional aid and avoid default.
To get its finances back into shape, Greece will have to adopt fresh aus- terity measures “within a few days” and “will have to privatize to an extent that goes beyond the imagination, even a Greek one,” Jean-Claude Juncker, president of the Eurogroup, said late on Tuesday.
“I have arrived at the conclusion that Greece must mobilize, by privatizing a large part of its patrimony to make its debt sustainable in the medium term,’ he said.
Speaking to the Lisbon Council think tank in Brussels, Juncker stressed that any consideration of a “soft restructuring of Greek debt” de- pended on Greece “rapidly” executing the 50-billion-euro sell-off plan it has already committed itself to.
“The Greek crisis is incomparably more difficult to resolve than the other two,” the Luxembourg premier said, referring to Portugal and Ireland, the other bailed-out countries in the eurozone.
Meanwhile, the government in Athens announced yesterday a series of banks to advise it on state asset sales and real estate development plans that aim to raise 50 billion euros to pay down debt.