Greece To Miss Deficit Targets For 2011-2012!
- The austerity program is not working and will not work. Unemployment is rising and tax revenues are falling. This is the worse time to apply austerity, it is making things worse!
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Greece to miss deficit targets for 2011-2012
by Demetris Nellas, Associated Press
Greece to miss deficit target for 2011-2012; deficit to reach 8.5 pct of GDP this year
ATHENS, Greece (AP) — Greece won’t meet 2011-2012 deficit targets imposed by international lenders as part of the country’s bailout, the Finance Ministry said Sunday.
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The country’s deficit this year is expected to reach 8.5 percent of gross domestic product, or euro18.69 billion ($25.2 billion) — higher than the targeted euro17.1 billion ($23.1 billion), which would have been 7.8 percent of GDP, the ministry said.
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Greece has been reliant since May 2010 on regular payouts of loans from a euro110 billion ($150 billion) bailout from other eurozone countries and the International Monetary Fund. It was granted a second euro109 billion package in July, but details of that deal remain to be worked out.
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The Finance Ministry said the missed target was because of a deeper-than-expected recession, with the economy contracting by 5.5 percent instead of the 3.8 percent estimate made in May. It implied the deficit could even exceed this level by the end of the year unless all new austerity measures were implemented.
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“The final estimate for a deficit equal to 8.5 percent of GDP can be achieved, if there is a proper response by the state authorities and the citizens themselves, on whose stance the country’s financial … and social future depends,” the announcement said.
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The announcement reflects the government’s frustration with tax collection, which they blame on tax inspectors’ lax performance, and its fear that citizens, angry at seeing their wages shrink and, at the same time, having to pay an increasing amount of one-off taxes, would refuse to pay.
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