Greece to submit plan to shore up economy

Hammered by markets and ballooning debt, Greece has pledged to cut its double-digit budget deficit to below the EU's limit of three percent of GDP by 2012.

The Greek Finance Minister says a plan will be submitted to EU officials in two weeks to shore up the country's ailing finances.

George Papakonstantinou, "The stability and growth programme is a plan of restructuring for our national economy. It outlines the great fiscal changes to taxation, the budget, but also the general great radical changes that will take place in the state and in the productive model of our economy."

People walk outside the Bank of Greece in Athens January 7, 2010. REUTERS/John Kolesidis Karahalis

The Minister said discussions with the European Commission and the European Central Bank are underway. Around January the 20th, the plan will be officially submitted to the European Commission.

Greek markets were hit at the end of last year by concerns about the country's fiscal deterioration. The new socialist government revealed the budget deficit would reach 12.7 percent of GDP in 2009, more than twice previous forecasts.

According to EU data, Greece is also set to become the EU's most indebted country this year, with debt rising to 124.9 percent of GDP.