Greece premier presents tough reforms

Financial Times
June 2, 2011

Greece’s prime minister will present a tough new economic reform package to Jean-Claude Juncker, chair of the eurozone group, in a bid to secure a fresh €60bn ($86.6bn) bail-out loan and avert a forced debt restructuring.

George Papandreou is due to explain how Greece will raise an extra €6.4bn in tax increases and spending cuts this year, accelerate privatisations of state-owned utilities and cut thousands of jobs in the overstaffed public sector, according to officials in Athens.

Friday’s meeting in Luxembourg with Mr Juncker marks a departure from Mr Papandreou’s usual practice of leaving his finance minister to handle details of economic policy, underlining the importance of the new package to Greece’s efforts to rebuild credibility with its partners.

“It’s a critical moment,” said a senior Greek banker. “Greece has to make clear it’s committed to overcoming political obstacles to implementing reform.”

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