Greece is confident it will meet its target to cut the budget deficit by 40 percent to 8.1 percent of economic output this year but risks remain on revenue growth targets, its Finance Minister said on Monday.
We believe that we will reach and maybe exceed the target to reduce (the budget deficit) to 8.1 percent in 2010, George Papaconstantinou told a news conference.
The debt-choked country is gearing up for a July 20-26 visit by the European Union, International Monetary Fund and European Central Bank, who will review its implementation of an austerity plan agreed in return for a 110 billion euro ($148 billion) bailout and assess whether it has met conditions to get a second aid installment.
The country's debt problems have strained Europe's monetary union and rattled financial markets.
Regarding Greece's target to grow revenues by about 12 percent this year, Papaconstantinou said: We are slightly under our targets but I would like to remind you that our budget targets referred to a more optimistic growth course, compared to the one included in the (EU/IMF) memorandum.
Papaconstantinou also said he saw the first signs that the forecast of a 4 percent gross domestic product (GDP) contraction this year was too pessimistic.
In the first quarter GDP shrank by 2.5 percent (year-on year). The first indications for the second quarter show a drop of about 3 percent, he said.
The state budget was within estimates in the first half of the year, with net budget revenue up 7.1 percent year-on-year, he said.
We are on the right path and the first results are already evident and they are a very important message mainly to Greek society and ... the Greek market as well as the international markets where we are looking forward to returning for funding the public debt, in 2011, he added.
Papaconstantinou said the government had no plans for new austerity measures, rejecting Greek media speculation that the country would be forced by international lenders to further belt-tightening.
There is no way that there will be new measures, enough with this, he said. We have a program that is being executed as planned and a little better than planned ... there is not one announcement by the EU, the ECB, the IMF that says otherwise.
(Additional reporting by George Georgiopoulos, Renee Maltezou, Angeliki Koutantou; Writing by Ingrid Melander; Editing by Ruth Pitchford)