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Greece needs major structural reforms not more taxes


08 Feb 2012


Euro & Finance

At a press conference in Athens today ahead of an expected announcement by Greek party leaders backing a new austerity plan in return for EU support for the latest bailout, Guy Verhofstadt, ALDE group leader, heading a delegation of senior Liberal MEPs, called for a major roll back of the Greek State, an end to party political clientilism and sweeping structural reforms to liberalise the economic sector

"It is clear that Greece is on the edge of the abyss. It is living beyond its means and has lost structural competitiveness. Successive governments have dodged the difficult decisions to reform the State. The resistance of the current political class, dominated by two large parties with entrenched vested interests is blocking reform.

It is imperative to agree a comprehensive growth and investment plan for 2020 that lays out a vision as well as concrete steps and reforms to be implemented over the next 8 years focusing on cutting wasteful expenditure and the tough but necessary decisions to overhaul the tax system, liberalise protected sectors of the economy and reduce the size of the bloated public sector."

"Failure to act now to rescue Greece would not only lead to contagion of other countries but precipitate a disorderly default with all its consequences for the wider Eurozone."

"In return the EU must show its solidarity with the Greek people and commit to keeping Greece inside the eurozone. TheTroika must commit to a comprehensive package of support for growth combining substantially increased resources for the bailout fund and easier access to the €15bn of available EU structural funds. The Troika must also recognise that Greece will not be helped by endless tax increases but by structural reforms and productive investment."

Time for the Greek State to let go

"Greece has an educated population, entrepreneurs and a number of productive economic sectors," added Verhofstadt. "The economy just needs to be set free from the yoke of the State and allow businesses to flourish in a free and competitive environment. The State must be cut back drastically and end the clientilism that is strangling the economy and holding back the reformists."

Theodoros Skylakakis (Democratic Alliance, Greece) who hosted the Liberal and Democrat Bureau meeting in Athens stated that "the efforts made both by the Greek people and the EU Member States need to continue, so that the Greek people find the strength to change existing mentalities. The fundamental problem is the lack of confidence which is not going to be restored, unless a serious investment plan is put in place. The country is in need of investments, not further taxes".

For more information please contact:

Corlett Neil - Tel:+32 2 284 20 77 Mob:+32 478 78 22 84



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