The Greek economy

Financially-struggling Greece are in disagreement with the European Commission regarding the plans to save the country’s crumbling economy, after they rejected calls from the commission to take more austerity measures.

The idea was raised during a eurozone finance ministers meeting, which takes place in Brussels for the next two days.

However, Greece’s finance minister George Papaconstantinou has urged the commission to show more support for Greece, stating that the best solution for the situation is by a more ‘explicit message’ of what has been decided last Thursday during an European Council sitting.

Papaconstantinou described the situation of trying to save Greece’s economy as ‘changing the course of a Titanic’, and that it cannot be done in a short period, while adding that the country is doing ‘enough’ to reduce its immense deficit.

The public deficit now stands at 12 per cent, and the beleaguered government is aiming to reduce the deficit to 8 per cent through additional measures such as a pay freeze to the public sector.

Olli Rehn, the EU Commissioner for Economic and Monetary Affairs, said today that the risks are ‘materializing’, reiterating the need for additional measures to be taken by the Greek government.

Many investors are anticipating a bailout plan by the EU for Greece, as Greece’s plumetting economy threatens to pull down the economic performance of the eurozone and also the value of the euro.

In the wake of Rehn and Papaconstantinou’s comments, the euro fell 0.3 per cent, and is currently at its weakest trade rate since May last year.