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23 January 2014

Kathimerini: Troika says Greece must dismantle barriers to competition for review to conclude


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The Troika has warned Greece that the ongoing review of its adjustment programme will not be completed in February unless Athens adopts the dozens of OECD recommendations for removing regulations that distort competition.


In an email sent by Greece’s lenders to Development Minister Costis Hatzidakis, which has been seen by Kathimerini, the troika says it is unable to see how the review can be concluded if the Greek government does not remove the barriers to competition identified by the OECD or provide satisfactory explanations for leaving some of the regulations unchanged.

The email expresses officials’ “concern” about reports that suggest the government is encountering opposition to its efforts to implement the OECD’s so-called tool kit. The troika says that these reforms are of “central importance” to improving the competitiveness of Greek businesses, reducing prices for local consumers and creating jobs. The country’s lenders also note that adoption of the OECD’s recommendations would send an “important message” about the government’s appetite for reforms.

After an 11-month study, the OECD identified in November 555 regulatory restrictions which it says undermine competition. The Paris-based organisation made 329 recommendations on legal provisions that should be amended or repealed. The OECD estimates the benefit to the Greek economy would be around 5.2 billion euros, or roughly 2.5 per cent of gross domestic product, as a result of “increased purchasing power for consumers and efficiency gains for companies.”

The government is likely to agree to adopt around 80 per cent of the OECD’s proposals. However, there are also two key fiscal issues that remain unresolved. One concerns the fiscal gap for 2014 and whether a Council of State ruling reversing wage cuts in the armed forces and emergency services means that the government has to adopt new measures this year. Then, there is the matter of the fiscal gap for 2015. The government estimates this to be around €1 billion, whereas the troika believes it will be two to three times this figure.

Full article

Further reporting, 27.1.14

OECD-report, 27.11.13

ESM/Regling talks on Greece to the Wall Street Journal in Davos, 27.1.14



© Kathimerini


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