Following a call by IMF chief Christine Lagarde for Greece to continue its fiscal efforts, bloggers are divided on what the country should do.
By Andy Dabilis for Southeast European Times in Athens -- 22/06/13
IMF chief Christine Lagarde called on Greece to continue its fiscal efforts. [AFP]
Bloggers are debating IMF Managing Director Christine Lagarde's call for the continuation of fiscal reforms in Greece and whether her guidance will strengthen the country's economy to help it become a more productive EU member.
"There are some really positive developments, but obviously more needs to be done in terms of revenue collection, in terms of independence of the tax administration going forward, in terms of product and service market reforms," Lagarde told Greek state television NET, shortly before the government shut down the station and laid off its 2,700 employees.
"Now is not the time to relax the effort," she said. "Opening up the product and service market I think would go a long way in attracting investors and making sure that the Greek economy can pick up."
Lagarde is steering Greece to create a stable economy and strengthen EU membership, according to Antonis Klapsis, head of research for the Konstandinos Karamanlis Institute for Democracy in Athens.
"The most important thing is to get back to development because you cannot just collect more taxes from people who do not have money to pay them," Klapsis told SETimes.
Klapsis said Greece's best hope lies in hitting a primary surplus next year to earn additional debt relief from its European creditors. But the country could be a long way from getting back into the markets, especially after burning investors with 74 percent losses in a bid to write down its debt by 98 billion euros last year.
Lagarde said Greece's debt targets for 2020 and 2022 had to be respected without resorting to another "haircut of debt reduction."
"Lagarde is afraid that steaming off some of the pressure will lead to a slowing pace of reform implementation. She is right about this," Aggelos Tsakanikas, head of research for the Foundation for Economic and Industrial Research in Athens, told SETimes.
Tsakanikas said the government cannot be sidetracked by the IMF's admission that it miscalculated the effects of austerity. "All this atmosphere of the wrong programme may lead to the conclusion that reforms are not necessary," he said.
But bloggers are divided over what the Greek society should do.
Greeks are worn down and society is not reacting anymore, blogger Strati Mazidis said. "The Greek people have accepted silently to bring down their standard of living from 60 to 100 percent so that the Greek economy returns to its 2009 levels."
Mazidis said desires and goals are at odds with the societal reaction. "The Greek society stands cowed in a corner and bears it with patience. [But] until when?"
Greek Prime Minister Antonis Samaras said he will stick with the reform recipe and will not veer from the demands of the EU-IMF-ECB troika. He said the reforms will help Greece recover from the severity of the economic crisis as soon as next year, and said the country is on the way to become a success story.
Yanis Varoufakis is critical of Lagarde's guidance.
"[Lagarde] was adopting a pattern first displayed by her predecessor: disagree with Europe's analysis and policies but, at the crucial moment, back down and legitimise these policies through complicity."
It is too late for both Greece and its creditors to dwell on past mistakes, Haralambos Tsardanidis, head of the Institute for International Economic Relations in Athens, said.
"Greece is obliged to continue the structural reforms. This is no time to be talking about a debt restructuring. The IMF gave an argument to Samaras when he first said it was on a false basis. Now he has made a U-turn, trying to do with the remains after the mistakes were made."
What should be done to make the Greek economy more stable? Share your thoughts in the comments space.