Norway Suspends $42 Million in EEA Greek Development Funds
Norway, Iceland and Liechtenstein froze payment of 235 million kroner ($42 million) in European Economic Area grants to Greece because the government didn’t meet the obligations linked to the funds.
“Greece had committed to paying 50 percent of each project. This was not followed up,” Norwegian Foreign Ministry said in a statement posted on its website yesterday. “It’s also unclear whether the money already transferred to the Greek authorities was forwarded to the appropriate recipients.”
About 13 million kroner of the committed funds for the period of 2004 to 2009 had been paid out, the ministry said.
Greece’s debt will balloon to 157.7 percent of gross domestic product in 2011 as the economy slumps for the third year, the European Commission forecast last week, fueling doubts whether the country will generate enough growth to pay its bills.
The government has implemented austerity measures including wage and pension cuts and higher sales taxes in exchange for a 110 billion-euro bailout from the EU and International Monetary Fund that was agreed on last May.
To contact the reporters for this story: Marianne Stigset at mstigset@bloomberg.net Josiane Kremer in Oslo at jkremer4@bloomberg.net
To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net
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