Greece must cut red tape, banks boost liquidity: EU official

ATHENS, March 15, 2012 (AFP) - reece has improved takeup of EU support funds but needs to cut red tape while its banks have failed to pump money from state loans

Ginto the struggling economy, a senior EU official said Thursday. Horst Reichenbach, head of a European task force created to speed up Greece's recovery, said Athens had made “good success” in absorbing 3.3 billion euros ($4.3 billion) in support funds last year, over 98 percent of the targeted sum.

“This has been a first very concrete, positive effect of the combined work,” he told a news conference at the close of a four-day visit to Greece to deliver the mission's quarterly report on Eu-assisted reforms. Greece is entitled to 20.4 billion euros in cohesion policy funds for the 2007-2013 period, and has so far absorbed 35 percent.

Greek authorities last year also managed to collect 946 million euros in tax arrears from a “collectible” overall target of eight billion, he said, over double the goal of 400 million euros set for 2011.

Swedish and Dutch experts will be offering additional help with debt collection, Danish and French experts will focus on high-wealth Greeks and Spanish experts will give advice on large corporate taxpayers, the EU mission said in its quarterly report.

The German finance ministry had also recently identified 160 tax experts, active or retired, who volunteered for service in Greece, the report said.

And France and Germany are supporting a parallel drive to reform central and local government, Reichenbach said.

He noted that “a lot remains to be done, in particular in the business environment there is too much red tape, too many administrative barriers.”for example, Greek customs controls for an exportable item require 20 days when the European average is 10 days, said Reichenbach, formerly deputy head of the European Bank for Reconstruction and Development.

The quarterly report, the second delivered so far, said the use of EU funds had to be “redoubled” as the recession enters a fifth year in Greece, leaving over a million jobless.

Over 870 projects earmarked for EU funding between 2000 and 2006 are still incomplete, it noted.

“Sometimes a number of iterations with relevant ministers are needed to finalise projects,” the report said, adding: “Preparatory work shows that in certain areas the Greek administration lacks the monitoring, reporting or control systems needed to ensure effective policy implementation.”