. therefore, it is essential to establish an effective framework for macroprudential supervision that will ensure both the systematic analysis of risks and the formulation of policies to address such risks. the state of the greek economy the economic slowdown has been less severe in greece than in many other european countries. however, this outcome reflects factors that, if left untreated, will reduce growth potential in the medium term. specifically, the performance of the greek economy during the crisis reflects the relatively - low level of openness and the deterioration of public - sector balance sheets from a position that was already worrisome prior to the onset of the crisis. a factor that has, however, supported the greek economy has been the soundness of its banking system. greek banks have been free of toxic assets and their exposure to the emerging economies of south - eastern europe has remained within manageable limits. a recent stress test conducted in close cooperation with the imf has reaffirmed the soundness of the greek banking system. the relatively - high growth rates experienced by the greek economy since its entry into the euro area reflect a catching - up process. to sustain a robust growth rate in the future, greece will need to address several key challenges, reflected in persistently very large currentaccount imbalances, high fiscal deficits, and worrisome debt levels. these imbalances are the result of structural rigidities, which have undermined competitiveness over time. to restore competitiveness and remove the imbalances, a dual agenda needs to be concurrently implemented : first, a multi - year program of fiscal consolidation, which can reduce risk premia and crowd - in private investment, raising the growth potential of the economy ; second, bold and wide - ranging institutional reforms in the public sector and structural reforms in product and labor markets, which can enhance productivity and raise the employment rate. only by undertaking these reforms will the greek economy be able to become more competitive and increase its growth potential and the prosperity of its citizens. the broad support received by the newly - elected government will greatly facilitate the implementation of the reform agenda.

george a provopoulos : interview in suddeutsche zeitung interview with mr george a provopoulos, governor of the bank of greece, in suddeutsche zeitung, conducted by mr αlexander ηageluken and mr markus zydra, published on 31 january 2013. * * * governor provopoulos, there is still a lot of scepticism towards your country. why should europe ’ s taxpayers give ever more money to greece? as a greek citizen i thank the european taxpayers – 230 billion euros to greece is a gigantic sum. previously we implemented fiscal consolidation, but we did not adequately implement structural reforms. as it became evident that the program was off track, confidence declined. therefore, i can understand the concerns of european taxpayers. but i can tell them : this time the greek government is committed to deliver. the country is changing. european taxpayers will get their money back. that sounds very optimistic. look, there has been a lot of progress. here are just a few examples : greece cut its fiscal deficit by nine percentage points compared to 2009. it cut the structural fiscal deficit – that is, excluding cyclical effects – by even more : 15 percentage points. these figures are unprecedented for any country at any time. plus, by the end of this year, greece will have fully regained the 32 percent loss in competitiveness ( measured in terms of relative unit labor costs ) that we suffered from 2001 to 2009. but that's not the whole story. greece hasn't fulfilled other promises. that is true. in the past structural reforms were not properly or adequately implemented. that was a big mistake, because they were needed to generate growth. and we badly needed measures that could offset the contractionary effects of fiscal consolidation. some economists say : it's not about lower labor costs, the greeks simply don't have products that can compete internationally. that is not true! we have tourism, shipping, light industry, agriculture, sources of renewable energy and so on – plus our ports are uniquely placed to serve as transportation hubs for a much broader area. with our warm weather we could be a significant agricultural producer. instead we import tomatoes from northern europe where the weather is like this ( points out of the window ). a major problem however was the steady erosion of competitiveness. do you really believe the politicians? it was you who testified before a parliamentary comittee last year that you had warned the two previous governments that the