Raad Economisch en Financiele Zaken wil structurele hervormingen in Griekenland (en)
The Vice-President of the Government of Spain and Minister of Economy and Finance, Elena Salgado, chaired an Ecofin Council i meeting attended by European Finance Ministers, which focused mainly on the economic situation in Greece, and decided that a strong adjustment of its budget deficit was needed, with wide-ranging structural reforms to be applied.
The Ecofin Council expressed its support for the Greek Government's decision to reduce its deficit by 4 points in 2010, from 12.75% of GDP to 8.7%, and below 3% by 2012.
Elena Salgado reiterated that “if necessary Greece will receive any aid it requires and that is our firm commitment”, although she added that the Greek Government had yet to request any financial aid.
The recommendations made to the Greek Government included immediate measures, starting this year, to put together and implement a package of global structural reforms, with specific measures concerning public wages, pensions, the healthcare system, public administration, markets, the improvement of the business climate, and increased productivity and employment.
The Spanish minister emphasised that for the first time the Council of Europe has resorted to an article in the treaty that allows the EU to send a warning to a member state whose economic policy does not conform to Europe's macroeconomic directives.
A team of experts from the European Commission, the European Central Bank and the International Monetary Fund will travel next week to Athens to advise the Greek authorities on applying the recommendations, according to European Commissioner for Economic and Monetary Affairs, Olli Rehn i, who joined Elena Salgado at the press conference after the Ecofin Council meeting.
Rehn announced the launch of infringement proceedings against Greece for manipulating statistics on the state of its public finances, while Eurostat i, the European statistics body, requested information on operations in currency markets and derivatives, which may have facilitated the discrepancies in the Greek budget deficit and public debt.
When asked if Spain had resorted to derivatives deals to mask public debt, Elena Salgado answered with a categorical "no”.
When asked whether the Spanish authorities had received a proposal from Goldman Sachs to use cross-currency swaps, as Greece is said to have done, Elena Salgado answered “no, absolutely not”. “If any such proposal had been received it would not have been accepted”.
The Commissioner for the Internal Market and Financial Services, Michel Barnier i, also indicated in the press conference that “the crisis is not over and we must regulate the financial market” to make it more robust, through comprehensive and efficient oversight, by putting in place mechanisms to prevent crisis situations in the future and including flexible tools for the banking sector.