Greeces worst fears confirmed, says PM George Papandreou

By Angela Monaghan, Economics Reporter Published: 8:31PM GMT twenty-six February 2010

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A lady writes "closed due to usery" at a bend of an Eurobank in senior manager Athens Photo: AFP/Getty Images

He done the comments following a revisit by European Union inspectors, who delivered a grave comment of the Greek economy.

Mr Papandreou pronounced that the prior Conservative administration department had "fled from the responsibilities", understating the bill necessity by half.

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"The repairs is incalculable. It is not usually monetary or mercantile but additionally affects the on all sides of the state," he said.

"Our avocation currently is to dont think about about the made at home cost and think usually about the presence of the country. Past policies have it required to ensue to heartless changes and revoke amassed privileges."

Mr Papandreou voiced that he would encounter Angela Merkel, the German Chancellor, subsequent week, among flourishing signs that tactful efforts are underway to find a resolution to Greece"s problems. He additionally met Josef Ackermann, Deutsche Bank"s arch executive.

However, the Greek budding apportion insisted that his nation would find a resolution to the monetary problems.

"We ask the EU for the oneness and they ask us to encounter the obligations. We will encounter the obligations ... we will direct European village oneness and I hold we will get it," he said.

"No alternative nation will compensate for the debts," he said. "It is a make a difference of honour and honour for the nation to put the own residence in order."

Greece"s debt problems have put vigour on the euro and have triggered jitters in universe markets, as fears that the nation will default on the debt persist, that would potentially destabilise a tellurian recovery.

In a pointer of how most of an stroke Greece"s problems are carrying elsewhere, Mr Papandreou will additionally encounter President Barack Obama.

Concern over Greece has been ascent given the supervision warned the necessity is using at 12.7pc of sum made at home product, far on top of the European Union"s 3pc limit.

Moody"s has warned that Greece is at risk of a "slow death" unless it neatly reduces the deficit, as higher debt costs means the economy"s mercantile intensity to diminish.

Mr Papandreou pronounced on Friday: "There is usually one dilemma: Will we let the nation go broke or will we react? Will we let the speculators suppress us, or will we take the predestine in the own hands?

"We contingency do whatever we can right away to residence the evident dangers today. Tomorrow it will be as well late, and the consequences will be most some-more dire," he added.

Analysts at Credit Suisse have likely that Greece"s debt to sum made at home product comparative measure will rise at around 130pc in 2012-13 from an estimated 113pc in 2009. That compares with the Greek"s supervision foresee of a 120pc rise in 2011.