Recommendation for a COUNCIL RECOMMENDATION on Greece's 2012 national reform programme
Date: 2012-05-30
Institutions: European Commission
Subjects: Greece, anti-crisis plan, budgetary control, debt reduction, financial aid, monetary crisis, public debt, reflation, structural adjustment

EUROPEAN COMMISSION 

Brussels, 30.5.2012  
COM(2012) 307 final 

Recommendation for a 

COUNCIL RECOMMENDATION 

on Greece's 2012 national reform programme 

{SWD(2012) 307 final} 

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Recommendation for a 

COUNCIL RECOMMENDATION 

on Greece's 2012 national reform programme 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Articles 121(2) and 148(4) thereof, 

Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of 
the  surveillance  of  budgetary  positions  and  the  surveillance  and  coordination  of  economic 
policies1, and in particular Article 5(2) thereof, 

Having regard to the recommendation of the European Commission2, 
Having regard to the resolutions of the European Parliament,3  

Having regard to the conclusions of the European Council, 

Having regard to the opinion of the Employment Committee, 

After consulting the Economic and Financial Committee, 

Whereas: 

(1) 

(2) 

On  26  March  2010,  the  European  Council  agreed  to  the  European  Commission’s 
proposal  to  launch  a  new  strategy  for  jobs  and  growth,  Europe  2020,  based  on 
enhanced coordination of economic policies, which will focus on the key areas where 
action 
to  boost  Europe’s  potential  for  sustainable  growth  and 
competitiveness. 

is  needed 

On 13 July 2010, the Council adopted a recommendation on the broad guidelines for 
the economic policies of the Member States and the Union (2010 to 2014) and, on 21 
October  2010,  adopted  a  decision  on  guidelines  for  the  employment  policies  of  the 
Member States4, which together form the ‘integrated guidelines’. Member States were 
invited  to  take  the  integrated  guidelines  into  account  in  their  national  economic  and 
employment policies. 

(3) 

On 12 July 2011, the Council adopted a recommendation on Greece’s national reform 
programme for 2011. 

1 
2 
3 
4 

OJ L 209, 002.08.1997, p. 1 
COM(2012)307 final 
P7_TA(2012)0048 and P7_TA(2012)0047 
Council Decision 2012/238/EU of 26 April 2012 

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(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

On 23 November 2011, the Commission adopted the second Annual Growth Survey, 
marking  the  start  of  the  second  European  Semester  of  ex-ante  and  integrated  policy 
coordination, which is anchored in the Europe 2020 strategy. 

On 2 March 2012, the European Council endorsed the priorities for ensuring financial 
stability,  fiscal  consolidation  and  action  to  foster  growth.  It  underscored  the  need  to 
pursue  differentiated,  growth-friendly  fiscal  consolidation,  to  restore  normal  lending 
conditions  to  the  economy,  to  promote  growth  and  competitiveness,  to  tackle 
unemployment  and  the  social  consequences  of  the  crisis,  and  to  modernise  public 
administration. 

On 2 March 2012, the European Council also invited the Member States participating 
in  the  Euro  Plus  Pact  to  present  their  commitments  in  time  for  inclusion  in  their 
stability or convergence programmes and their national reform programmes. 

On  12  April  2012,  Greece  submitted  its  2012  national  reform  programme  and 
incomplete information regarding their budgetary plans. Greek authorities are invited 
to  submit  the  full  set  of  standard  tables  required  under  the  preventive  arm  of  the 
Stability and Growth Pact.  

On  21  February  2012,  the  Eurogroup  agreed  on  a  second  economic  adjustment 
programme  for Greece. The  implementation of the economic policies outlined  in the 
Memorandum  of  Understanding  on  Specific  Policy  Conditionality  will  contribute  to 
reduce the Greek public debt to 117% of GDP by 2020. It was agreed that the official 
sector  financing  of  the  programme  would  amount  to  EUR  130 billion  until  2014, 
additional to the amounts committed in the first financing programme. 

The  release  of  the  tranches  is  based  on  compliance  with  quantitative  performance 
criteria and a positive evaluation of progress made with respect to the policy criteria 
laid  down  in  Council  Decision  2011/734/EU  of  12  July  2011  (as  amended  on 
8 November 2011 and 13 March 2012) and the Memorandum of Understanding setting 
the economic policy conditionality, which was signed on 14 March 2012. 

(10)  On  19  March  2012,  the  first  instalment  (EUR 5.9  billion)  of  the  first  tranche  (EUR 
14.5 billion) of the new financing programme was paid by the EFSF to Greece. Greece 
also received EUR 1.6 billion from the IMF. By May 2012, Greece has received EUR 
147.5 billion from official financing under the first and the second programme. 

(11) 

In 2010 and 2011, Greece made partial progress towards the ambitious objectives of 
the  adjustment  programme.  Several  factors  hampered  implementation:  political 
instability,  social  unrest  and 
issues  of  administrative  capacity  and,  more 
fundamentally, a recession that was much deeper than previously projected. Important 
fiscal  targets  were  missed,  which  led  to  the  adoption  of  additional  consolidation 
measures  throughout  2010  and  2011.  However,  Greece  achieved  a  substantial 
reduction in the general government deficit: from 15.8 per cent of GDP in 2009 to 9.1 
percent in 2011. 

(12)  On 18 April 2012, the Commission adopted a communication on ‘Growth for Greece’ 
highlighting the positive impact that full and effective implementation of the economic 
adjustment programme can have by laying the foundations for growth, investment and 
social  renewal.  This  Communication  recalls  that  Greece  can  draw  strength  and 
concrete support from its membership of the EU and of the euro area. It underlines that 

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the  reforms  set  out  in  the  second  economic  adjustment  programme  are  designed  to 
restore  the  growth  and  job  creation  potential  of  the  Greek  economy  and  to  create  a 
more equitable society. It outlines the extensive financial support being made available 
to  Greece  and  emphasises  the  readiness  of  Greece's  partners,  and  in  particular  the 
Commission  to  identify  ways  to  maximise  the  impact  of  early  deliverables  through 
swift actions and EU support. 

(13)  The economic crisis and subsequent fiscal consolidation measures have had an impact 
on  the  ability  of  Greece  to  achieve  the  Europe  2020  goals,  especially  the  socially 
oriented  ones.  Nevertheless,  the  structural  reforms,  particularly  those  in  the  labour 
market, the liberalisation of several sectors and a number of measures to improve the 
business  environment,  will  help  promote  competition,  spur  productivity,  increase 
employment  and  reduce  production  costs,  thus  contributing  to  an  increase  in 
employment  and  limiting  poverty  and  social  exclusion  in  the  medium  term.  Despite 
the  economic  crisis,  Greece  has  continued 
the 
environmental goals of Europe 2020. 

towards  achieving 

to  work 

(14)  A  strategic  re-programming  of  the  Structural  Funds  is  underway,  with  a  focus  on 
support  to  youth  employment  and  competitiveness  (in  particular  SME's).  The  new 
measures  strengthen  actions  in  the  areas  of  employment  passport,  training  and 
professional qualifications and access to finance for Small and Medium Enterprises.  

(15)  Greece  has  made  a  number  of  commitments  under  the  Euro  Plus  Pact.  The 
commitments, and the implementation of the commitments presented in 2011, relate to 
fostering employment, improving competitiveness, enhancing sustainability of public 
finances and reinforcing financial stability.  

HEREBY RECOMMENDS that Greece should: 

Implement  the  measures  laid  down  in  Council  Decision  2011/734/EU  of  12  July  2011,  as 
amended on 8 November 2011 and 13 March 2012, and the Memorandum of Understanding 
on specific economic policy conditionality, which was signed on 14 March 2012. 

Done at Brussels, 

For the Council 
The President 

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