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04 May, 2000
The Greek economy's performance has improved but doubts remain about the sustainability of progress made, European Central Bank (ECB) Vice-Chairman Christian Noyer said on Wednesday.
Outlining the ECB's report on the domestic economy in terms of the country's bid for euro-zone entry on January 1, 2001, Noyer said Greece met the Maastricht Treaty's five criteria for membership.
At the same time, he told the European parliament's financial and monetary committee, the ECB had qualms about sustainability and urged strict fiscal discipline, a tight incomes policy and the implementation of structural reform.
The country's harmonized inflation rate was 2.0 percent, lower than the EU's 2.4 percent reference point, inflation had shown a declining trend, and price stability had so far been attained.
But inflationary pressures were feared due to an anticipated slackening of monetary policy linked to declining interest rates, and wage rises should therefore be contained, Noyer said.
In addition, the budget's primary surplus needed to rise in coming years, he added.
Commission's OK for Greek euro entry gets mixed response:
European Union Employment and Social Affairs Commissioner Anna Diamantopoulou on Wednesday welcomed the Commission's decision to back Greek entry into the 11-member euro zone.
She said the recommendation followed a detailed and objective analysis of Greece's economy, which concluded that the country had attained a high level of sustainable convergence with the EU's other members.
The main opposition New Democracy party said it welcomed the Commission's report on the economy, as its content confirmed the party's view that the government had attained merely nominal alignment through artificial means of raising taxation and keeping lending rates high.
According to the Communist Party of Greece, the Commission's report embellished the real state of the economy and concealed the fact that the brunt of membership of the euro zone would be borne by working people.
The Coalition of the Left and Progress charged that real economic convergence -as opposed to nominal - had not been attained and should become the government's priority, along with social equity.
Source: Athens News Agency