{
  "title": "IMF Survey: Greece: Reform Agenda Essential for Growth",
  "publication": "IMF News, July 15, 2011",
  "sourceUrl": "https://www.imf.org/en/news/articles/2015/09/28/04/53/socar071511a",
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  "summary": "Amid continued market turmoil in Europe, the IMF's Executive Board has approved the disbursement of about €3.2 billion to Greece. According to the IMF's assessment, while the program includes some very difficult measures, reforms have slowly started delivering results.",
  "publishDate": "2011-07-15",
  "sections": [
    {
      "heading": "Approval and immediate financing",
      "content": "- IMF’s Executive Board approved the disbursement of about €3.2 billion to Greece as part of the three-year lending arrangement agreed in May 2010.\n- Approval date context: the Executive Board approved the disbursement on July 8; the publication date is July 15, 2011."
    },
    {
      "heading": "Program assessment and macroeconomic developments",
      "content": "- Program delivers: “while the program includes some very difficult measures, reforms have slowly started to deliver results.”\n- Rebalancing and competitiveness:\n  - Exports have increased by 22 percent.\n  - Competitiveness is improving, in part because of a decline in labor costs.\n  - Inflation, adjusted for taxes, is running well below the euro zone average.\n- Growth prospects:\n  - A return to positive economic growth is currently projected for the first half of 2012, conditional on full implementation of difficult structural reforms."
    },
    {
      "heading": "Structural reforms implemented and their scope",
      "content": "- Pension reforms described as “the most far-reaching that virtually any country has done in one step.”\n- Labor market reforms described as “very comprehensive.”\n- Government has started opening up closed professions.\n- Additional reform priorities highlighted:\n  - Addressing the high tax burden on labor that discourages hiring.\n  - Making the judicial system more efficient.\n  - Removing barriers to growth in specific sectors.\n  - Creating investment opportunities through privatization and reducing red tape.\n- Capacity constraints:\n  - Need to strengthen capacity in key ministries and institutions with the skill sets needed to implement agreed reforms.\n  - Government has asked partners for technical assistance, which the IMF will provide."
    },
    {
      "heading": "Fiscal policy performance and targets",
      "content": "- Fiscal performance to date:\n  - Authorities have met all quarterly fiscal targets since the start of the program, most recently those for March 2011.\n  - There has been a reduction in the fiscal deficit of more than 5 percent in 2010.\n- Risks and adjustments:\n  - Difficulty controlling spending at lower levels of government; state-level under-execution used to ensure overall targets were met.\n  - Without structural changes to fiscal policy, risk that the budget deficit will become entrenched at 10 percent or more.\n- Fiscal targets in the approved program:\n  - Achieve a deficit of 7½ percent of GDP in 2011.\n  - Achieve a deficit below 3 percent of GDP by 2014, as required by the Maastricht treaty."
    },
    {
      "heading": "Financing gap and external support",
      "content": "- Market access and timing:\n  - Greece would be unlikely to regain access to private markets by early 2012, as initially envisaged under the program.\n- Privatization and residual gap:\n  - Ambitious privatization program committed to by the government will help reduce need for additional financing, but a notable residual gap remains to be closed through the end of 2013, when the current IMF-supported program is due to expire.\n- Strategy to address the financing gap:\n  - Agreed strategy likely to involve a combination of voluntary private sector involvement and additional official support from euro area member states.\n  - Modalities still being worked out.\n- Political support at euro area level:\n  - In a statement on July 11, the 17 finance ministers of the Eurogroup recognized the need for a broader and more forward-looking policy response to assist Greece in bolstering debt sustainability.\n  - IMF will continue to work closely with Greece and European partners to support these objectives."
    },
    {
      "heading": "Social and political context",
      "content": "- Public reaction:\n  - Widespread protests and expressions of concern about the economic program acknowledged.\n  - Recognition that the program is “very difficult and ambitious” and that public concerns are understandable.\n- Fairness and social protection:\n  - Program needs to be fair and protect the most vulnerable groups of society.\n  - Tackling tax evasion emphasized as essential: develop a well-functioning tax administration and necessary judicial backing to hold accountable those who have exploited system weaknesses."
    },
    {
      "heading": "Debt sustainability and overarching objective",
      "content": "- Debt focus:\n  - Greek authorities and Europeans are working on a comprehensive solution to manage the debt burden and give Greece breathing space to implement reforms.\n- Core objective:\n  - The real objective is for Greece to restore growth; once on that path, Greece will be able to reduce debt to sustainable levels.\n  - Restoration of sustainable growth hinges on implementation of the economic reform program to make the economy more competitive and less rigid and protective of vested interests.\n\nIMF Survey: Greece: Reform Agenda Essential for Growth — July 15, 2011. International Monetary Fund.\n\n---\n\n Content in this bundle\n\n- Cr11175pdf (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\n References\n\n- https://www.imf.org/en/News/country-focus\n- PRESS CENTER\n- IMF Country Focus\n- IMF Survey Interview\n- Read the press release\n- Greece fast facts\n- Outlook for euro area\n- Restoring growth\n- continue to work closely\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2015/09/28/04/53/socar071511a"
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    "Published: July 15, 2011",
    "IMF’s Executive Board approved the disbursement of about €3.2 billion to Greece as part of the three-year lending arrangement agreed in May 2010.",
    "Approval date context: the Executive Board approved the disbursement on July 8; the publication date is July 15, 2011.",
    "Program delivers: “while the program includes some very difficult measures, reforms have slowly started to deliver results.”",
    "Rebalancing and competitiveness:",
    "Growth prospects:",
    "Pension reforms described as “the most far-reaching that virtually any country has done in one step.”",
    "Labor market reforms described as “very comprehensive.”",
    "Government has started opening up closed professions.",
    "Additional reform priorities highlighted:",
    "Capacity constraints:",
    "Fiscal performance to date:",
    "Risks and adjustments:",
    "Fiscal targets in the approved program:",
    "Market access and timing:",
    "Privatization and residual gap:",
    "Strategy to address the financing gap:",
    "Political support at euro area level:",
    "Public reaction:",
    "Fairness and social protection:",
    "Debt focus:",
    "Core objective:",
    "[Cr11175pdf (PDF)](/-/media/websites/imf/imported/external/pubs/ft/scr/2011/_cr11175pdf.pdf){rel=\"external\" type=\"application/pdf\"}",
    "[https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[IMF Country Focus](https://www.imf.org/en/news/country-focus)",
    "[IMF Survey Interview](https://www.imf.org/en/news/search)",
    "[Read the press release](https://www.imf.org/external/np/sec/pr/2011/pr11273.htm)",
    "[Greece fast facts](https://www.imf.org/external/np/exr/countryfacts/grc/)",
    "[Outlook for euro area](http://www.imf.org/external/pubs/ft/survey/so/2011/CAR062111A.htm)",
    "[Restoring growth](http://www.imf.org/external/pubs/ft/survey/so/2011/INT022511A.htm)",
    "[continue to work closely](https://www.imf.org/external/np/sec/pr/2011/pr11276.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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