European Commission endorses Greek plan to cut budget deficit

BRUSSELS, Feb. 3 (Xinhua) -- The European Commission (EC) endorsed on Wednesday Greece's plan to bring its budget deficit below 3 percent of gross domestic product (GDP) by 2012, saying it would closely monitor the plan's execution.

EU Economic and Monetary Affairs Commissioner Joaquin Almunia addresses a news conference at EU headquarters in Brussels, capital of Belgium, on Feb. 3, 2010. The European Commission (EC) endorsed on Wednesday Greece's plan to bring its budget deficit below 3 percent of gross domestic product (GDP) by 2012, saying it would closely monitor the plan's execution. (Xinhua/Wu Wei)

"Greece has adopted an ambitious program to correct its fiscal imbalances and to reform its economy," said EU Economic and Monetary Affairs Commissioner Joaquin Almunia.

"This is in the interest of the Greek people, who will benefit from better and more durable growth and job opportunities in the future, and it is in the interest of the euro area and of the EU as a whole," Almunia said.

He said the Commission would monitor the execution of the budget "closely and regularly".

The Greek government submitted its stability program to the EC on January 15, pledging to reduce its budget deficit by 4 percentage points to 8.7 percent of GDP in 2010 and thereafter to 5.6 percent in 2011, 2.8 percent in 2012 and 2 percent in 2013.

The EC has asked Greece to submit its first report in mid March 2010, spelling out the implementation calendar and standing ready to take further measures if needed.

Thereafter, the country is required to submit quarterly integrated reports from mid May 2010 on the implementation of the recommendations put forward by the EC to improve its economic competitiveness.

Greece's public deficit is estimated to reach 12.7 percent of its GDP in 2009, far above the accepted ceiling of 3 percent of the EU.

Due to the economic crisis, 20 EU member states are in excessive deficit procedures. These countries have to bring their budget deficits back under the 3 percent target between 2011 and 2015.