Following the Executive Board discussion, Ms Christine Lagarde, IMF Managing Director and Chair, said: "The Greek authorities have continued to make commendable progress in reducing fiscal and external imbalances. However, progress on institutional and structural reforms, in the public sector and beyond, has still not been commensurate with the problems facing Greece. Greater reform efforts remain key to an economic recovery and lasting growth.
"The authorities are taking corrective actions to meet the ambitious target of a zero primary balance in 2013. Deeper public sector reforms are critical to complete the necessary fiscal adjustment going forward with broad public support. Progress in modernising revenue administration continues to fall short of what is required, and more needs to be done to strengthen its autonomy and operational efficiency. It is also important to prepare adequately for, and implement successfully, the income tax reform while putting in place a property tax that achieves the revenue target. It will be critical to avoid tax policy changes that undermine revenues. Given the slow progress in public administration reforms, efforts should focus on ensuring exit of unqualified personnel to create room to hire new staff with the relevant skills.
"Broader structural reforms must be accelerated to boost productivity and growth. And urgent steps need to be taken to address concerns about the structure and governance of the privatisation programme and to improve its effectiveness.
"Considerable progress has been made in safeguarding financial stability, notably through the recapitalisation of the core banks and the sale of bridge banks. Key challenges going forward include cleaning up balance sheets, ensuring strong governance structures, and rapidly re-privatising the remaining state-owned bank.
"Public debt is projected to remain high well into the next decade. The assurances from Greece's European partners that they will consider further measures and assistance, if necessary, to reduce debt to substantially below 110 per cent of GDP by 2022, conditional on Greece's full implementation of all conditions contained in the programme, are welcome. Their continued commitment to provide adequate financial support to Greece during the life of the programme and beyond until the country has regained market assess, provided that Greece complies fully with the programme, remains essential", Ms Lagarde said.
Full press release
Further information
Transcript of a Press Roundtable with IMF Managing Director Christine Lagarde, 1.8.13
© International Monetary Fund
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article