Public Investments are Boosted with 10 Million - The Best from Greece

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Posted on: 19/Nov/2009

The Greek government plans to pour just over 10 billion euros into public investments next year by stepping up efforts to absorb European Union funds in an attempt to provide the flagging economy with a growth driver.

Economy, Competitiveness and Merchant Marine Minister Louka Katseli said yesterday 7 billion euros will come from EU funds while a further 3.3 billion euros would be drawn from the state budget.

“The restoration of economic growth is a top priority for the government. We are providing an answer to the crisis with this step,” Katseli told journalists.

So-called “green economy” schemes, in fields such as renewable energy and health, are set to top the spending list along with projects aimed at boosting the country’s eroding competitiveness, according to the minister.

EU funds will come from the National Strategic Reference Plan (ESPA), which runs from 2007-13, and has a total budget of 26.2 billion euros but has been largely untapped due to red tape.

Katseli admitted that targeting such a large inflow in one year is ambitious after bureaucracy held back the absorption of funds under the previous government to just 800 million euros in the last three years.

“It took 140 joint ministerial decisions to implement projects totaling just 800 million euros,” she said, promising to slash bureaucratic procedures.

Public investment is seen helping offset a drop in private sector investments hurt by the recession and tighter lending policies adopted by banks.

Greece’s economy is expected to contract at an annual pace of 0.30 percent next year after showing a negative growth rate of 1.1 percent percent this year, according to European Commission forecasts.

The recently elected Socialists have upped funds earmarked in the 2010 draft budget’s Public Investment Program to 10.3 billion euros, 8.3 percent higher than in 2009.



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