Forex Europe News – Report states that Greece missed Fiscal Targets

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German weekly magazine “Spiegel” stated over the weekend that Greece has missed its fiscal targets set by the IMF, EU and ECB (known as the troika). Greek Finance Minister denies the report which was released before the conclusion of the “troika” meetings . The troika is set to release an official report on its findings next week. He also denied a release from Washington that mentioned Greece’s weakness in achieving its financial goals.

The Spiegel’s findings were that the deficit in the public budget was higher than expected. The magazine stated that the reason behind this is that the Greek government still spends more than agreed in the aid programme. On top of that tax income is still lower than demanded.

Last week the IMF suggested that it will not release its next month’s aid trance totalling 12 billion Euro if Greece’s fiscal conditions aren’t met. “We Europeans have the same conditions as the IMF,” EU

Economic Affairs Commissioner Olli Rehn was quoted as saying in Spiegel magazine’s report that “We will decide on the next tranche after the troika’s report. The situation is very serious,” Rehn added.

Meanwhile, while official from the EU, ECB and IMF are currently investigating Greece’s finances, tens of thousands of demonstrators stood in front of the Greek Parliament. Many of them were families, from children to the elderly to denounce the nation’s entire ruling class and vent their anger at the IMF and its demands for yet more belt-tightening.

Under last year’s bailout plan, Greece was expected to resume borrowing on financial markets by 2012. However, that seems unlikely now so the EU is preparing a new aid plan that would meet Greece’s funding needs through to 2013.

In return, the Greek government is expected to impose yet more austerity measures and put through a plan for privatisations. The officials are checking Greece’s fiscal progress before approving the new aid the country needs to avoid default.

Greek Finance Minister George Papaconstantinou was upbeat on the budget negotiations.

“We expect that they will conclude successfully in the next few days,” he said in a statement.