PM sends letter to Barroso ahead of Commission report

Greek Prime Minister Lucas Papademos on Wednesday sent a letter to the chief of the European Commission calling for help on a number of key policy areas that could rejuvenate growth and employment in the debt-wracked nation.

His letter coincides with the release of a Commission report on Greece later on Wednesday. The 41-page document, set to be presented by Commission President Jose Manuel Barroso to the European Parliament, reportedly repackages existing assistance for Greece while offering detailed analysis of the changes the country is expected to make over the next few years.

In his letter to Barroso, the Greek prime minister singles out several policy priorities that require special attention from Brussels. These are financial support for small and medium-sized enterprises (SMEs); advancing major infrastructure projects; reducing youth unemployment; implementation of the privatization program; policies in the energy sector; and, finally, the absorption and effectiveness of EU structural funds.

Also, Papademos acknowledges that successful implementation of fiscal consolidation and structural adjustment demanded by the country's international creditors, the EU and the IMF, hinges on the far-reaching reform of the Greek state.

“The long-standing structural weaknesses of the public administration and, more broadly, the general government sector have been a source of misallocation of resources, diminished effectiveness of policy implementation, impediments to private sector entrepreneurship and, indeed, social injustice,” he said in the letter, describing state reform as a top national priority.

“The implementation of these policies will be complementary to the growth-enhancing structural measures of the second economic adjustment program,” Papademos said.

“The mutually reinforcing nature of this two-pronged strategy should bring forward the recovery of the Greek economy and forge the foundations for sustained growth,” he said.

The Commission, which is the EU's executive arm, was expected publish on Wednesday a series of ideas on how the contracting Greek economy can return to growth, which the country badly needs to be able to service its huge debts.

The report also lists a number of problems facing the Greek economy, whose recovery is key for the future of the euro.

"Greece suffers from a lack of capacity to implement policy, manage public finances, collect taxes, open markets to competition, make public procurement work efficiently and innovatively, pay suppliers, or offer timely judicial review to its citizens,” according to a draft document seen by Reuters. 

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