The Greek Parliament Budget Office has warned the government regarding the 2015 state budget process and more specifically the revenue shortfall, the fiscal gap’s widening and the increasing spreads, calling at the same time to take its decisions “as soon as possible.”
“The new governments’ decisions must be taken quickly to reverse the negative climate caused by the election, the failure to reach an agreement with the Troika and the New Democracy – PASOK coalition government’s attempt to resort to markets in October 2014 without such an agreement” is noted in the Office’s announcement, underlining, however, that a primary surplus gives the new government a certain freedom in public finances management.
The announcement’s authors also distinguish the country’s huge commitments that will have to be fulfilled within the following months, if an agreement with Greece’s partners is not reached soon. Moreover, they took a step further, saying that Greece’s position on the negotiation table is worse than that of the lenders, while they underlined that “a lack of an agreement in relation to the country’s financial settlement would amount to a credit event.”
Finally, as they described, a non-agreement with the country’s partners would result in the loss of some 50 billion euros. As they argued, since the spring of 2014, the Memorandum reforms “froze,” while the perceived deprivation revenue has widened the fiscal gap and reduced the state’s cash. “This trend should stop,” the Parliament Budget Office announcement concluded.
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