Greece recession will deepen, says Antonis Samaras

Greece will suffer a deeper recession than thought this year, Prime Minister Antonis Samaras said.

He expects the economy shrink by 7%, greater than the 5% forecast by the crisis- country's central bank.

Representatives of Greece's three international lenders have arrived in Athens a bid to get its deficit cutting measures "back track".

But, Mr Samaras criticised comments by some foreign officials "undermining" Greece's national effort.

sufficient progress, it may not receive the final part of its bailout 31.5bn euros ($38bn; £24.5bn).

Assistance Greece totalling 130bn euros was agreed in March, its second major package, with strict conditions attached that force Greece cut debt and spending.

A deeper recession will not help Athens improve its performance, it is already behind in its austerity plans because its economy is shrinking faster forecast.

Mr Samaras said the country, which has been recession for five years, would not return to growth 2014.

He is expected to ask more time to repay its loans.

The Bank of Greece had expecting GDP to shrink 5% this year, which would have been its deepest recession the 1930s.

Economists calculate that Greece may need a third rescue package up to 50bn euros.

Greece's performance is assessed by the International Monetary Fund (IMF), European Central Bank (ECB) and European Commission, who have been dubbed the troika.

The IMF said it was "supporting Greece overcoming its economic difficulties" and would work with the country to get it "back on ".

However, reports the weekend suggested that the IMF would refuse calls further aid.

New visitor
Meanwhile Greece is expecting high-profile visitor this week.

The European Commission president, Jose Manuel Barroso, is planning his first visit the country since 2009.

"The purpose the meeting is to meet Mr Samaras and discuss the overall economic situation in Europe and particular in Greece," Mr Barroso's spokesman said.

He said it was "a regular meeting" and that the preparation the talks had been "under discussion for time".

Greece has promised reduce its budget deficit to below 3% of annual national income measured in Gross Domestic Product (GDP) by the end of 2014. At the of last year, Greece's overspend was equivalent 9% of GDP in 2011.

Successive Greek governments have managed trim 17bn euros from government spending. That has brought the country's total debt down more than 160% of GDP to 132% according to official released on Monday.

Under the of its international loan agreement with the troika, Greece has vowed reduce its total debt to 120% of GDP by 2020.

But, Prime Minister Antonis Samaras would had to have raised another 12bn euros through higher taxes and the sale of public assets as the country's loss-making railways to have this bailout target.


Adapted and abridged from: BBC News, July 24, 2012.