Bloomberg News

Greece Needs Stability for Growth, Development Minister Says

July 03, 2012

Greece must stabilize its economy and push ahead with reforms to secure the foundations for economic growth, Development, Infrastructure and Transport Minister Kostis Hatzidakis said.

“Regaining market and investor confidence is the first step and political stability is very important for this,” Hatzidakis said in a copy of a speech, e-mailed from the Athens- based ministry today. “We seek to anchor the country in the euro area, taper harsh measures, particularly for the weaker strata, and gradually change the country’s course to get it out of a deep recession quagmire.”

Greek Prime Minister Antonis Samaras put together a coalition government after his New Democracy party won June 17 elections on pledges to renegotiate parts of the 130 billion- euro ($164 billion) second bailout from the European Union and International Monetary Fund. An inconclusive poll on May 6 led to the June vote and fanned concern over a Greek euro exit.

The bank recapitalization plan should be completed as soon as possible and conditions should be created for deposits to return, Hatzidakis said. Greek bank deposits held by businesses and households have declined by 52 billion euros, or 25 percent, since December 2010.

Greece should speed up state asset sales and real-estate development because it can be a “significant tool for growth,” he said. Greece’s economy is in its fifth year of recession. Repaying 6 billion euros owed by the state to companies will help the business environment, Hatzidakis said.

Europe needs to find “definitive solutions” for the debt crisis, Hatzidakis also said. “It’s now obvious that the solution lies in a real fiscal union, in enhancing the role of the European Central Bank, in common debt management. Markets won’t calm down until we have reached this point.”

To contact the reporter on this story: Natalie Weeks in Athens at

To contact the editor responsible for this story: Jerrold Colten at

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