European Union Economic and Monetary Affairs Commissioner Olli Rehn comments on the economy in Europe, Portugal’s budget-austerity effort and Greece’s push to qualify for further aid disbursements from the euro area and International Monetary Fund.
Rehn spoke to reporters today in Luxembourg. His reference to the “troika” in the remarks on Greece means the European Commission, the European Central Bank and the IMF, which together monitor Greek budget-cutting plans.
On the European economy:
“We know that we are currently in a mild recession in Europe following the turmoil in the financial markets in the middle of this year.
“On the other hand, we are now seeing certain signs of market stabilization and on the condition that the euro zone -- both individual member states and the euro zone collectively -- will be able to take the necessary decisions in the coming period then we will be able to return more rapidly, more quickly to sustainable growth and better employment.”
“The realistic objective is that Portugal will return to the markets in 2013.”
“It has been necessary to restore the sustainability of public finances in Portugal because the economic imbalances got accumulated and got rather bad.”
“I am fully aware of the difficulties and the painful adjustment in Portugal concerning how the Portuguese people face this. At the same time, it’s very important that these are done respecting social fairness and restoring competitiveness of the country because that’s, in the end of the day, essential for the sustainable recovery of Portugal.”
On the timing of the next possible aid payout to Greece:
At the “latest in November, once Greece has completed the prior actions concerning fiscal consolidation and structural reform and once the Eurogroup and the IMF have endorsed this disbursement.”
“I expect that this will happen in the coming weeks. We are rather close now to conclude the negotiations and achieve a staff-level agreement. Once that is done, then the troika will have to finalize the compliance report, including the assessment of financing needs and debt sustainability.”
A possible two-year extension of Greece’s budget-cutting targets to 2016 “is one issue that the Eurogroup will have to consider in the decision-making at the next round.”
To contact the reporter on this story: Jonathan Stearns in Luxembourg at firstname.lastname@example.org
To contact the editor responsible for this story: James Hertling at email@example.com