By ELENA BECATOROS
Feb. 12, 2011
ATHENS, GREECE - Greece on Saturday slammed European and International Monetary Fund debt inspectors overseeing the country's efforts to reform its economy, accusing them of interfering in the debt-ridden country's internal affairs and saying they had overstepped their mark.
In an unusually harshly worded statement issued in the early hours of Saturday morning, government spokesman Giorgos Petalotis said the behavior of the inspectors at a news conference the previous day had been unacceptable.
The IMF, European Central Bank and European Commission delegation said Greece must privatize euro50 billion ($68 billion) in state assets and speed up structural reforms in the next few months to keep the country's troubled finances afloat. The IMF representative also said some of Greece's frequent demonstrations against the government's reforms were being carried out by groups angry at the prospect of losing "unfair advantages and privileges."
Petalotis said in his statement that, "We have needs, but we also have limits. And we do not negotiate the limits of our dignity with anyone," He added: "We take orders only from the Greek people."
It is the first time the government has publicly struck back at the IMF and EU, which have rescued Greece from bankruptcy but at a price many Greeks consider too harsh.
The opposition conservative party, however, struck back at the government, saying it was "too late for false tears" and that the government's "post-midnight theatrical performance is a farce."
Greece's economy is under strict supervision as part of a deal for the country to receive a euro110 billion package of bailout loans from the IMF and other European Union countries that use the euro -- funds that saved Greece from defaulting on its mountainous debts last May.
In return, the government has been pushing through stringent and unpopular reforms, including cutting public sector salaries and pensions, increasing taxes and overhauling labor laws. The austerity program has led labor unions to stage a series of strikes and demonstrations.
Batches of the loan are released every quarter, before which representatives from the IMF, EC and ECB visit Athens to review progress.
On Friday, the representatives -- collectively dubbed the 'troika' in Greece -- said Greece must privatize euro50 billion ($68 billion) in state assets and speed up structural reforms in the next few months to keep the country's troubled finances afloat.
IMF mission chief Poul Thomsen said Greece's long-term reforms were being "fiercely tested by vested interests." He said some of those demonstrating against the reforms, such as truck drivers and pharmacists, were "people who are angry because the government wants reforms that will take away their privileges."
Thomsen said he was "not surprised that these groups are protesting but I'm also convinced ... that the Greek population see it for what it is: an attempt to preserve their unfair advantages and privileges."
The troika's Friday afternoon press conference had led to quick outrage in sections of the Greek press, with one anchor on a private network describing Thomsen's remarks as being "unacceptable." But there was no government reaction until Petalotis' statement shortly before 2 a.m.
"We asked them to help and we are fully honoring our commitments. But we didn't ask for anyone to intervene in our country's internal affairs," he said, adding the government would make clear that "everyone must understand their role."
Greek national debt is set to exceed 150 percent of GDP this year, and during the news conference the troika laid out the new privatization program worth euro50 billion through 2015 -- seven times larger than a target set three months ago.
Thomsen scoffed at a suggestion that Greece might sell its ancient monuments to raise money, but argued "the mismanagement of public property is a major source of waste" in Greece.
Privatization targets are likely to include state companies not listed on the stock market and the development of public land, including Olympic facilities that have languished since the Athens Games in 2004. Greece will seek euro15 billion ($20 billion) in privatization and real estate development this year alone, according to Finance Ministry officials.
Petalotis said the government had frequently spoken of the need to utilize state property, but stressed that any such program would have to be done transparently and "in no case means the sale of public land."
"It is equally obvious that only the Greek government is able to take these decisions," he said.
Associated Press writer Derek Gatopoulos contributed to this report.