–Adds Hopes of Not Having to Use Aid Mechanism, Support from EU

FRANKFURT (MNI) – Greece will do what is necessary to correct its
fiscal situation and is “not yet out of the woods,” Prime Minister
George Papandreou reiterated on Friday.

Speaking to the press following the EU leaders summit in Brussels,
Papandreou acknowledged the challenges that Greece is facing. “The time
ahead will be difficult,” he said.

The minister also highlighted the structural changes that the
Mediterranean country has taken to “tackle the challenges”.

“These changes have already been launched,” Papandreou said. “All
the other structural changes will take place during this year. 2010 will
be the year of institutional reforms. In this way, we will lay out the
ground to attaining our goal.”

The PM also said that Greece had no objections with Germany’s
insistence on penalties and sanctions on countries that do not respect
the Growth and Stability Pact.

“We have no objection to preventive supervision,” Papandreou said.
Speaking through a translator, he said that this was exactly why Greece
was paying such a high price.

“There was not, at the European level, a supervision mechanism to
prevent this crisis,” Papandreou said. “I think that Greece will become
one of the most transparent countries in the Eurozone and maybe also in
the European Union.”

Papandreou added that a task force would be established for the
purpose of prevention. However, “this task force will not only be
dealing with prevention, but also check for any possibility even to
amend the treaties,” he said.

“But, I think again that the European institution will strengthen,
will improve with the economic governance and protect our country from
speculators,” he said.

Furthermore, Papandreou stressed that the International Monetary
Fund (IMF) also “gave the green light” to Greece’s austerity measures.

“I think the IMF won’t request other measures,” he said. “This, of
course, is a strong signal of the gravity of the situation. I think that
the measures that we have taken are sufficient.”

“Now things will get calmer with all the changes that have been
requested,” Papandreou continued. “Yesterday’s decision will help to
implement all institutional changes, but to implement this plan in
serenity, without this pressure on the Greek people.”

Shifting his comments to the financial markets, Papandreou stressed
that rumours in the markets should end and that opinion should be based
on fact.

“It is totally a new environment that will prevail in Greece,”
Papandreou said. “I would like to send a message that we are doing our
job, we are doing our duty, with the concrete support from the 27
members states of the European Union.”

“This outcome will have a positive outcome, not only on the
political level, but also on the level of the capital markets,” he
added.

The PM also noted that aid mechanism was not only related to
Greece.

“Greece was the pretext for establishing this mechanism. And we
hope that we won’t have to activate this mechanism. But it is, indeed, a
European mechanism. It might concern other countries that can face
difficulties,” he said. “This mechanism exists and will help stabilize
the situation in any given country.”

Papandreou also stressed that the Greek banking industry was
healthy. “This is not only a declaration of the Prime Minister of
Greece, but also of the European Central Bank.”

–Frankfurt bureau; +49-69720142; frankfurt@marketnews.com

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