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BERLIN – Hoping to win approval from the biggest contributor to international bailouts, Greece has asked German officials to support its case with lenders to allow tax cuts.

Development Minister Nikos Dendias met German Finance Minister Wolfgang Schaeuble and Economic Affairs and Energy Minister Sigmar Gabriel to plead Greece’s cause before meeting envoys in Paris next month from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB).

“We discussed a lot about the issue of taxation: how the Greek economy could operate in a framework with fewer taxes and with powerful growth tools that could help small and medium-sized enterprises (SMEs) and the funding they need to grow,” said Dendias after his meeting with Schaeuble, which he described as “very cordial.”

During Dendias’s talks, it was agreed that Germany’s public investment bank KfW would provide another 30 million euros for a second fund being created by the Institution for Growth in Greece (IfG). KFW has already committed 100 million for IfG’s first fund, which will provide loans to businesses.

The second fund, targeted at SMEs, will also be boosted by 30 million euros from France’s Caisse des Depots, 50 million from the European Investment Bank and 40 million from the Onassis Foundation.

Dendias was assured by German officials that Berlin would support Greece’s request to be allowed to use European Union structural funds to refinance business loans even though the European Commission is skeptical about the plan

LIQUIDITY NEEDED

Dendias said their talks had “covered all issues concerning the Greek economy and the progress of the stabilization program,” including taxation issues, the Athens News Agency ANA-MPA reported.

Taxation issues were discussed at length during the meeting, the minister noted, as well as ways in which the Greek economy could operate in a framework with fewer taxes and strong developmental tools for helping small and medium-sized enterprises to be financed and grow.

“At the end of the day, unemployment in Greece cannot be fought if the economy is not working properly, if no new products and new businesses are being created, if liquidity does not move toward the economy, if exports do not rise. The help of the German factor in this direction can and must be significant,” Dendias said.

Dendias and Gabriel agreed to continue cooperation to support the process of reforms and economic growth in Greece, an announcement said, while Gabriel noted that Greek efforts were now starting to yield the first results and “deserve our recognition”.

“The Federal Ministry of Economic Affairs and Energy supports this reform process with a series of measures, such as a dialogue between experts in the area of promoting exports and the tourism industry, as well as by providing knowhow for reforms in the area of Renewable Energy Sources. We wish to continue this support and, if possible, extend it wherever this is desired by the Greek side,” Gabriel said.

The Greek minister referred to Greece’s steady progress toward an exit from the crisis and the very promising results of the current fiscal adjustment and structural reforms programme implemented by the Greek government, though this had required great sacrifices from the Greek people.

“Greece depends more than ever on the cooperation and support of its European friends,” he added, thanking Gabriel for the invitation to visit Berlin and exchange views on a series of issues.

“We particularly referred to creating jobs, the liquidity of markets and the issue of SMEs, boosting exports and attracting foreign investments, both on a bilateral and a European level. A common denominator in our talks was our commitment to closer cooperation with tangible results,” Dendias said.

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The post Germany Asked To Back Greek Tax Cuts appeared first on The National Herald.

Source: The National Herald
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