Prime Minister Alexis Tsipras presented his government’s policy statement in Parliament last night (October 5), setting as key priorities to re-establish financial stability, secure economic recovery and return to growth, achieve substantial debt relief and to radically reform the public sector, while cracking down on corruption and and bureaucracy.

The government aims for the economy to return to positive growth rates in the first half of 2016 and to regain access to the markets within the next 20 months, he noted, outlining three immediate priorities: reducing debt by way of extending payments, reducing interest rates and introducing a growth clause and long grace period; recapitalizing the banks; and establishing a special body that will be tasked with creating the necessary framework to attract private investments and encourage local brands and entrepreneurs. 

The PM also announced that the controversial 23% VAT on private education will be suspended until mid November, by which point alternative measures with an equivalent revenue effect can be devised.

On the recent refugee crisis, Tsipras argued that Dublin III must be reviewed, stating that five ‘hot spots’ will be created on the islands for arriving refugees and migrants.

Draft budget tabled to Parliament

Greece’s draft 2016 budget, which was also submitted to Parliament yesterday (5.10), envisages the economy shrinking 2.3 pct this year, followed by an expected contraction of 1.3 pct next year. It also expects a primary deficit of 0.24 pct of GDP for this year and a primary surplus of 0.5 pct of GDP in 2016, in line with the agreement with creditors.