C
ertainly, the economic situation was still
fragile. The crisis was not over yet, but the
prospects were promising. Unfortunately,
since then, potential wealth has vanished, new fis-
cal measures were imposed, arrears have inflated,
the citizens’ disposable income has shrunk, and the
competitiveness of the economy has deteriorated.
Nowadays, uncertainty is being prolonged, the
country is dragging, and the economy is still sink-
ing, mainly due to the huge delays in the comple-
tion of the MOU review.
The question, therefore, is what should be done
to stabilise the situation, so that the country gets
on a path of sustainable growth, with justice and
cohesion, national dignity and dynamism.
In my opinion, above all, it requires a robust polit-
ical leadership, with a coherent plan and the will
to deliver.
This political leadership must set some priorities
straightforward:
• Front-loaded enactment of structural reforms,
which the government is not willing to imple-
ment.
• Intensive implementation of the privatisation
programme, without internal impediments.
• Provision of liquidity to the real economy,
through the faster absorption of EU funds, the
repayment of arrears, and the cleaning of bank
balance sheets.
• Change of the fiscal policy mix, moving
towards a gradual reduction in taxation by
safeguarding fiscal discipline, using fiscal
equivalents from the expenditure side, and
focusing on combating “shadow economy”.
• Emphasis on the need to reduce the medium-
to-long term fiscal targets, in order to create
fiscal space.
• Enhancement of debt sustainability, by deter-
Trade with Greece
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It is nowadays generally accepted that, at the
end of 2014, the economy had been stabilised
and was showing clear signs of recovery.
What should be done to
stabilise the situation, so
that the country gets on a
path of sustainable growth
By Christos Staikouras, MP, Head of Economic Policy Sector,
Nea Demokratia – Former Alternate Minister of Finance
