Eurostat on Monday announced it has withdrawn its reservations on reported data of the September 2005 notification and April 2006 notification concerning Greece, after the clarification of issues concerning the recording of transactions with the EU budget, the accounts of social security and the amounts of other receivables and payables for the years 2002-2005. Commenting on Eurostat's decision, a spokeswoman for EU Monetary Affairs Commissioner Joaquin Almunia, said the European Commission now had a satisfactory picture of Greek public finances for the period 2002-2005.

 The EU executive's statistics agency said it was using the GDP figures notified in April 2006, and not the revised GDP data reported by the Greek authorities on 1 October 2006. Given the magnitude and complexity of the revised GDP data (an increase of 25% compared to the old figures), Eurostat will carry out a complete verification of GDP data once Greece has delivered a full inventory of the sources and methods used for the new calculations.

 As far as Greece is concerned, a methodological visit carried out in June 2006 and September 2006 clarified the pending issues mentioned in the Eurostat News Releases of 26 September 2005 and 24 April 2006, concerning the recording of transactions with the EU budget, the accounts of social security and the amounts of other receivables and payables for the years 2002-2005, and resulted in a revision of Greek deficit data. The increase in government deficit for Greece was equal to 0.3% of GDP in 2002 and 2003, 0.9% in 2004 and 0.7% in 2005. The methodological visit will be finalized by the establishment of an action plan for the improvement of Greek government finance statistics, to be carried out during the course of next years, agreed between Eurostat and the Greek statistical authorities.

As announced in April 2006, Eurostat is currently discussing with the relevant technical working groups the accounting treatment to be applied to the following issues: securitization operations undertaken by government, classification of payments for the use of roads, sales or transfers of impaired government claims (notably in the case of foreign claims) and payments in connection with the transfer of pension commitments to government. Furthermore, Eurostat's decision on "The recording of military equipment expenditure" of 9 March 2006 does not seem to have been fully applied by Germany and Greece.

 The GDP notified in October 2006 for EDP purposes was revised by small amounts compared to the GDP notified in April 2006 for the reporting period 2002-2005, most notably by Estonia, Cyprus, Hungary and Malta. Changes in GDP affect deficit and debt ratios due to a denominator effect. The revision of the GDP for Greece is still under investigation, owing to the exceptional size of the revision. In effect, there are high statistical uncertainties about these revised GDP data, which require a complete verification by Eurostat once Greece has delivered a fully revised inventory of the sources and methods used for the new calculations.

 Eurostat said the increase in deficit in 2002-2005 was mainly due to reduction of surpluses of other central government bodies and social security funds (corrections for transfers received from the ordinary budget in 2002-2005, and change in data sources in 2005).

Source: Athens News Agency

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