Austerity Fails In Greece As Deficit Blows Away EU Estimates


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Greece has missed its deficit targets, and now its debt to GDP ratio is set to rise yet again, according to the European Commission (via Bloomberg).Their on the ground research shows Greece having a 9.5% shortfall for their 2011 budget. That’s way higher than the IMF set target, which was 7.4%.

Further, that budget shortfall is set to add to the country’s already significant debt, and take debt to GDP to 158% this year. That’s a rise from 150%.

“Greece has apparently not fulfilled the conditions sufficiently of late. The issue of privatisations will be the most sensitive point here,” Ewald Nowotny of the ECB said.

Greece could lose its next aid check from the EU and IMF, it is concluded they are not following the rules of the program. That could lead to a default. A new Bloomberg poll released today says 85% of investors surveyed expect a Greek default.

All of this comes at the same time a new report reveals that Greece conducted 13 deals, with the help of Goldman Sachs, to hide its debts in 2001.

Don’t miss: Who gets slammed in a Greek default >