The prospect that Greece's fiscal crisis could force it to default on its sovereign debt has prompted speculation that it may eventually be pressured to depart the 16-member euro zone. In an effort to end such talk, Mr. Papandreou said in a nationally televised appearance that the country was committed to the common currency. His comments came as the ECB warned Greece that a proposed law to restructure private-sector debt could do more harm than good, saying bluntly that key parts of the law were "not consistent with the principle of an open market economy" and might squeeze off the flow of credit. ... The proposed law, which would ease debt repayments by households and small businesses affected by the financial crisis, was one of the key campaign promises of Greece's recently-elected Socialist government.
His comments came as the ECB warned Greece that a proposed law to restructure private-sector debt could do more harm than good, saying bluntly that key parts of the law were "not consistent with the principle of an open market economy" and might squeeze off the flow of credit.
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The proposed law, which would ease debt repayments by households and small businesses affected by the financial crisis, was one of the key campaign promises of Greece's recently-elected Socialist government.
"There is no case of Greece leaving the euro zone or resorting to other kind of help, such as the IMF," Papandreou told a news conference to mark the socialist government's first 100 days in office. Papandreou said Greece wanted to establish a sense of trust and certainty among its creditors, and Greeks were not just ready but avid for change and for things to move forward. ... "It would not be a courageous measure to make the poor and wage-earners pay -- this is not our policy," he said.
Papandreou said Greece wanted to establish a sense of trust and certainty among its creditors, and Greeks were not just ready but avid for change and for things to move forward.
"It would not be a courageous measure to make the poor and wage-earners pay -- this is not our policy," he said.
The Commission, the European Union's executive arm, is responsible for upholding EU law. It had already once launched proceedings against Greece for unreliable deficit statistics in 2004, but closed them in 2007. "There will probably be another infringement procedure... because providing timely and reliable statistics is an obligation under EU law and they have failed in their obligation," the EU source said. Greece revised its 2008 budget deficit to 7.7 percent of gross domestic product from 5.0 percent reported in April and also revised its 2009 budget deficit forecast to more than 12 percent of GDP from 3.7 percent forecast in April.
"There will probably be another infringement procedure... because providing timely and reliable statistics is an obligation under EU law and they have failed in their obligation," the EU source said.
Greece revised its 2008 budget deficit to 7.7 percent of gross domestic product from 5.0 percent reported in April and also revised its 2009 budget deficit forecast to more than 12 percent of GDP from 3.7 percent forecast in April.
"The fact that Eurostat has not validated those figures does not necessarily imply that the final figures will be higher. It simply means that Eurostat at this stage is not capable of validating the figures," Commission spokeswoman Amelia Torres said.
