The Greek government has adopted a new plan to reduce the budget deficit in the next few years. The plan aims to cut the deficit to 8.7 percent of GDP this year, 5.6 percent next year and below 3 percent by 2012. The plan envisages deep cuts in hospital and defence spending. Budget revenue is expected to rise due to higher excise taxes on tobacco and alcohol, an overhaul of the tax system and a crackdown on tax evasion. Greece will send the draft to the European Commission on Friday.
Greece will be urged next week in the Council to improve its economic statistics after a report by the European Commission found “deliberate misreporting of figures by the Greek authorities in 2009”.