Greek debt default would be catastrophe, says Papandreou

GREEK Prime Minister George Papandreou, buffeted by negative polls and continuing protests at economic austerity measures, says he will continue with policies aimed at drastically cutting the country's debt and says the alternative - a default - would be a catastrophe.

"We have taken a decision, that no Greeks should live through the consequences of a default, and to change the country radically so that it is no longer under anyone's supervision and can stand on its own feet," Mr Papandreou said in an interview with Sunday newspaper To Vima.

"Never in my life did I imagine that we would need to slash pensions in order for the state to continue to pay any pensions at all," he added. "We chose the least painful of two options: one (is) difficult, the other - defaulting - is catastrophic."

On Friday, the government unveiled an austerity program running through 2015, aiming to save around €28 billion ($38.42bn). The measures will slap a host of new taxes on austerity-weary Greeks - in spite of previous pledges to avoid more blanket tax increases.

Mr Papandreou faces continued protests and dwindling support in opinion polls. More than 10,000 gathered yesterday afternoon at Syntagma Square in central Athens, while a poll published overnight shows the ruling Socialists trailing the conservative opposition by 4 per cent.

A poll conducted monthly by research company Public Issue and published yesterday in newspaper Kathimerini shows the ruling socialists trailing opposition New Democracy 31 per cent to 27 per cent, while only 8 per cent of respondents say they are satisfied with the government, versus 92 per cent dissatisfied.
WSJ

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http://www.theaustralian.com.au/business/news/greek-debt-default-would-be-catastrophe-says-papandreou/story-e6frg90o-1226074191243


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