Greek finance minister defends deficit revision

27 Sep, 2004

Greece's finance minister rejected on Sunday criticism that his big revision of past budget deficit data opened the economy to risks, including a credit rating cut, saying it was done in the interest of credibility.
His comments appeared to be at odds with remarks by ECB Vice President Lucas Papademos, who was Greece's central bank governor at the time of euro entry in 2001, that the relevant data was already in the public domain at the time.
"It's a matter of principle to present credible and transparent budgets," Finance Minister George Alogoskoufis told Kathimerini newspaper in an interview. "Criticism should not be directed to those who tell the truth."
Revised data from EU statistics agency Eurostat last week showed Greece's 2000 budget deficit at 4.1 percent of Gross Domestic Product (GDP) versus a previous 2.0 percent, pushing it over the EU's 3.0 percent limit, a benchmark for entry to the euro zone.Papademos said on Saturday the controversial revisions to Greece's budget deficit by Eurostat should have come as no surprise.
The figures were in Greek central bank reports and known to Eurostat, said Papademos, who added the statistical treatment Greece used was well known and accepted.
The Finance minister said there was a mismatch in the last few years - a public debt dynamic that signalled the existence of a budget deficit problem against official data showing very low deficits.

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