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Samaras Tells TIF: No More Austerity

samarastif_390_0709With thousands of police trying to keep thousands of protesters away, Greek Prime Minister Antonis Samaras on Sept. 7, in a speech at the opening of the Thessaloniki International Fair (TIF), promised there would never ever again be any additional pay cuts, tax hikes or slashed pensions even if international lenders demand them.
“There will be no need for any new measures beyond what has already been agreed,” said Samaras. “The country cannot take further talk of measures.”
The government is trying to put Greece on the road to economic recovery but is relying on $325 billion in two bailouts from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) to do it. The money runs out next year and the IMF has said Greece will need a third package of $11-14 billion and could face a 46.8 billion euros black hole between 2015-2020.
The New Democracy Conservative leader Samaras, who skipped the TIF traditional speech previously, said he wouldn’t use the event as other premiers had to make pie-in-the-sky promises of handouts and state largesse, a sideways swipe at previous prime minister and then-PASOK Socialist leader George Papandreou who was elected in 2009 on a platform that said, “The money is there,” only to ask for the Troika’s help as the economy collapsed around him.
Ironically, current PASOK leader Evangelos Venizelos is in a coalition government with Samaras as his Deputy Prime Minister/Foreign Minister, elevated to the lofty positions so that the government could have a narrow five-seat majority in the 300-member Parliament even though the Socialists have only about 5 percent of the popular vote.
In a speech lasting close to 50 minutes, Samaras vehemently defended his government’s policy of adhering to the Troika-prescribed adjustment program and attacked the opposition over its critical stance evene though austerity has created a record 27.6 percent unemployment rate and pushed 20 percent of the population into poverty levels.
“Does the opposition think I don’t see unemployment, that I can’t feel the pain?” he said. “That’s what I’m trying to combat,” he said. The Troika has warned that if tax revenues continue to fall far short of expectations as they are doing now, and that the gap in the economy can’t be covered, that if it needs to provide additional aid more austerity would be attached. Samaras said he would reject it, although he said that previously and submitted to more.
Samaras said that Greece would have Europe’s biggest cyclically-adjusted surplus, of 6 to 8 percent of GDP, at the end of the year and insisted that a primary surplus would lead to its lenders sticking to their agreement to provide the country with some form of debt relief next year, a so-called “haircut” in which Greece wouldn’t pay back all its loans to the Troika.
German Chancellor Angela Merkel, who is up for re-election in the Sept. 22 federal polls, said she won’t allow that even though she has backed aid to Greece, albeit with austerity attached. If Greece reneges on part of its loans to the public lenders, as it did in 2011 when Venizelos was finance minister and imposed 74 percent losses on private investors, taxpayers in the other 16 Eurozone countries – including Germany – would pick up much of the tab for decades of wild overspending by Greeks.
The prime minister also talked up the economy’s prospects, arguing that investments were beginning to trickle in to Greece. He suggested that Greece could reach pre-crisis levels of prosperity before 2020 with the help of the energy and tourism sectors and progress in privatizations, which are woefully behind schedule and with little interest in Greek enterprises.
Speaking a day after gross Gross Domestic Product (GDP) figures for the second quarter of the year revealed a barely-discernible smaller than expected shrinkage in growth, Samaras said Greece was on course to beat the Troika’s recession forecast of 4.2 percent of this year, although that still means there’s no growth. He said he would be happy with that.
“The recession this year will be smaller than forecast,» he said after data showed that the economy shrank by 3.8 percent rather than the flash estimate of 4.6 percent in the second quarter.
Ending his speech on an upbeat note, Samaras suggested that the current crisis was a small blip in Greece’s long history. “Five or six years of tough challenges cannot erase 3,000 years of glorious history,” he said.
In previous years, prime ministers delivered their TIF speeches on Saturday evenings before holding a press conference on Sunday morning. This year, Samaras made his address at around 11 a.m. and said he would not be holding a press conference, giving him the chance to dodge tough questions.

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