Greece rejects IMF and EU privatization demands

Feb 12, 2011, 16:53 GMT

Athens - Greece on Saturday rejected demands made by the International Monetary Fund (IMF) and the European Union to privatize state-run companies and sell state-owned properties as part of reforms to meet the terms of a multi-billion euro bailout deal.

Greece may need help, 'but we also have dignity,' government spokesman George Petalotis said. 'And we're not negotiating this with anyone. We only receive orders from the Greek people.'

The government had to agree to strict austerity measures in order to receive the EU-IMF bailout package, which was agreed in May and totals 110 billion euros (149 billion dollars) in emergency loans. It has so far received 38 billion euros of the aid.

A team of EU and IMF auditors on Friday said Greece must undertake 50 billion euros worth of privatizations by 2015. Previously, only 7 billion euros had been mentioned.

'It is essential to increase privatizations to help reduce public debt,' EU mission chief Servaas Deroose said.

But Prime Minister George Papandreou told IMF chief Dominique Strauss-Kahn on Saturday during a telephone conversation that the auditors' behaviour was unacceptable, the premier's office said.

Strauss-Kahn had shown 'understanding' for the situation, it added.

Despite their criticism, the team of auditors on Friday approved a new 15-billion-euro tranche of aid to be paid by mid-March to the southern Mediterranean country. The European Commission is to make a final decision on the funds in early March.

The government has already cut back salaries and pensions to slash a budget deficit that stood at 15.4 per cent of gross domestic product in late 2009 by six percentage points by the end of 2010.

Unions have held months of strikes and demonstrations to protest against the measures.

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