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Monday, July 23, 2012

Greek economy is in a 'Great Depression' says Samaras


Mr Samaras's comments come two days before a team of Greece's debt inspectors arrive in Athens to push for further austerity measures if the debt-laden country wants to qualify for further rescue payments and avoid a chaotic default.

Athens wants to soften the terms of a €130bn bailout agreed last March with the European Union and the International Monetary Fund, to soften their impact on an economy going through its worst post-war recession.

Greek GDP is expected by the end of this to have shrunk by about a fifth in five consecutive years of recession since 2008, hammered by tax hikes, spending cuts and wage reductions required by two EU/IMF bailouts. Unemployment climbed to a record 22.6pc in the first quarter.

"You had the Great Depression in the United States," Samaras told Clinton, who was visiting Greece as part of a delegation of Greek-American businessmen. "This is exactly what we're going through in Greece - it's our version of the Great Depression."

Athens must reduce its budget deficit below 3pc of GDP by the end of 2014, from 9.3pc of GDP in 2011 - requiring almost another €12bn euros in cuts and higher taxes on top of the 17 billion successive governments have cut from the budget shortfall.

The Telegraph

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