Meeting with Olli Rehn | Statements

December 9, 2010 | categories : Articles and Statements, Prime Minister

December 9, 2010

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G. A. PAPANDREOU: Let me once again welcome Commissioner Olli Rehn to Athens. I believe, this once, there was less tension and anxiety on both sides, compared to your last visit and I think this is proof of the fact we have come a long way from where we were at this year’s start when the situation was much tougher.

Indeed a lot has happened since. We fought and we are still fighting hard to restore our credibility. We convinced our partners we are credible and thus a European support mechanism was set up from scratch, which helped Greece come through those dire and critical times when the markets showed no confidence in our economy.

Europe’s response to our problem was positive while, since day one, we insisted this was not a problem for Greece alone but rather for Europe and the Eurozone, which I think the facts themselves eventually corroborated. For our part, Greece and the Greek people are exerting a gigantic effort involving pain and sacrifices to contain the giant deficits of the past.

We managed to have the deficit drop by 6 % of the GDP, which is more than the initial target we had committed ourselves to. We proceeded with implementing great structural changes in social security, closed professions and the state itself and we introduced rules of transparency to ease this country out of the crisis but also to have a sustainable and fair economy.

Greece, in recent months, showed it did not only have courage but also determination and efficiency, which is exactly what it took for us to make it. We obviously still have a long way to go. For the next few months we should be focusing on big structural changes which are already underway. These are changes by means of which we are fixing chronic problems that have been there for decades on end, if I may say so.

We are capitalising on time the support mechanism has given us. It acts as a shield while we are making up for lost time which is true of the previous decades. We are not confining ourselves to taking measures touching exclusively on proper fiscal management, for we are taking advantage of time given to us to introduce great changes in state structure and operations. We will thus be able to consolidate the rule of law, social justice, fair allocation of burdens and proper wealth distribution.

But we also providing Greek citizens with safety and security they need as we strengthen the state and reinforce the competitiveness for our economy through breakthroughs, such as the ‘Kallikrates’ project in local government and administration. We are making justice all the more effective, putting rules for transparency in place, cutting down on red tape everywhere, and eventually providing citizens with better services.

Our objective for the year 2011 is not just to have the deficit drop dramatically even further, which is what we are working on anyway, but rather to put those preconditions in place which should restore growth in 2012.

In this path of ours, the more targets we achieve, the more optimistic we may be each day our efforts are acknowledged. This is exactly what has been happening as the possible extension for repaying the 110 billion euro loan has opened up new prospects.

I wish to thank Commissioner Olli Rehn for the close cooperation he’s had with everyone involved in this country’s administration and its government. Regardless of whether we have identical views or not, we indeed have a straightforward and honest working relationship within an ambiance of mutual trust and this is what is most defining.

Of course, cooperation with the European Commission is not limited to issues that regard solely our country. We had an excellent exchange of views and ideas on developments and decisions needed on a European scale.

We are actively involved in the discussion, now underway, which regards the future of the EU and the Eurozone, along with setting up and strengthening the permanent stability facility and offering new dynamics for growth in Europe.

As you know, back on Monday, I had the chance to talk about all these with Mr. Barroso, Head of the European Commission, while we are bound to discuss such matters yet again next week in the upcoming European Council meeting.

I nonetheless wish to express my satisfaction for the Commission’s overall constructive stance and its position in such discussions. There is a much more integrated approach in terms of European developments which will furthermore clearly have a more positive impact on the global economy.

There is by now great convergence in our views, as views held by the Greek government and the Commission are almost identical. This also applies to proposals such as the one on the Eurobond or similar and equivalent suggestions aimed at propping up the euro and the European market.

Yet, there are also proposals which prop up not only the support mechanism and fiscal stability; they support fiscal equilibrium and contribute to the growth prospects for Europe overall, which is what we are also pursuing. I would call this a precondition for Europe to come out of this recession while creating new jobs for youth, and not just for the sake of youth alone.

And there are further proposals on market and financial systems’ supervision, lack of which was, after all, at the core of problems and the crisis in 2008. Our duty is to jointly support the European edifice and its fundamental values as well as our single currency, the euro, and our common future.

Let me at this point once more thank Olli Rehn for our cooperation. Thank you for listening to me and let me now give the floor to the Commissioner.

O. REHN: Thank you. Thank you, Prime Minister. Dear George, ladies and gentlemen.

First of all, I would like to thank Prime Minister Papandreou for our excellent cooperation. And I want to also express my appreciation for the hard work and substantial results you are achieving in terms of reforming your country. Thank you for hard work, and thank the Greek people for determination in this regard.

As the Prime Minister said, we discussed issues both related to the euro area as a whole and related to Greece. We had a very substantive and creative discussion on the economic situation in Europe. and we see in the Commission that this current crisis is increasingly systemic, which calls for a systemic and thus comprehensive response, which needs to combine both horizontal policy measures as well as country-specific actions by EU member states.

The Commission is working on this with member states, and it is a work in progress. And we indeed need a comprehensive response to this systemic crisis.

There are many issues in this context, and for instance we see that it is very important to find ways and means to reinforce the financial backstops. And for that we need to review all options.

Moreover, it is important that each and every member state puts its own fiscal house in order and creates the conditions for sustainable growth and job creation.

Indeed, we are all in the same boat. Whether we come from Northern or Southern Europe, Western or Eastern Europe, we are all in the same boat and our great challenge is now to safeguard financial stability in the euro area as a whole, for the sake of sustainable growth and job creation in Europe, for the sake of economic and social welfare of our citizens.

That’s the key challenge now for everybody in Europe, and it’s important that we all pull together and we try to have a common comprehensive response in this current difficult situation.

We also discussed the economic reform programme of Greece, and I welcomed the strong determination of the government to reform the economy of this country. The first two quarterly reviews by the EU-IMF Troika have been in fact crystal clear. Greece is on track. Significant progress has been achieved, especially in reducing government deficit and in pursuing key reforms such as in the pension system and in the labour market.

These efforts are paying off. Greece will start seeing the end of a tunnel by next year, with the growth turning positive in 2011, next year, especially during the second part of the year, and thus paving the way for a stronger economic growth in the coming years.

So please rest assured we want to work together with Greece. Europe stands by you, Prime Minister, and by the Greek people. Thank you.