Quotes in the article titled “Athens hopes deep cuts will restore confidence”
March 4, 2010
Government officials in Athens were arguing last night that Greece’s new fiscal efforts were, at least on some measures, larger than those of Ireland – seen since last year as the pace-setter on deficit-cutting measures among the crisis-hit countries of the eurozone.
In Greece, yesterday’s measures will lead to cuts in government nominal wages and allowances of about 8 per cent. With Greek inflation seen at 1.5 to 2 per cent, the hit in purchasing power will be equivalent to a 10 per cent drop, officials said.
The Irish wages were cut by about 7 per cent on average in the first year but faced deflation of 4.5 per
cent, softening the blow on purchasing power, they added.
The comparison with Ireland underlines the significance of yesterday’s package, the toughest in decades, and reflects how confident bankers and analysts in Greece are that the new measures will help reduce the budget deficit and restore confidence in the government’s ability to put public finances in