Stavros Lambrinidis, Greek Foreign Minister HARDtalk

Welcome to HARDTalk. The pattern of the recent past seems to have been

blown and panic. -- gloom. You pronounce that you are going to

change your ways in Greece. What is different this time round?

difference this time is that the decisions in Europe are far recent

-- far reaching and a long-term. We are at a bottomless barrel. That is

hugely important. Both for economic reasons and psychological reasons.

Economies are psychologies. Up to now, people in Greece felt they

were making huge sacrifices, and they are, but without a light at

the end of the tunnel. People in Europe felt that there were

throwing water in a barrel without seeing any results. The reason for

this was not that Greece was not what it was -- doing what it was

doing. In my view, it was because this debt problem was not simply a

great one. It revealed itself as a European one. It needed a European

solution to be able to stabilise things. I believe we have the

stability now and the breathing space. We are able to implement

extremely tough measures and Europe Do you think that we're done his in

effect a target of old? No, I think we were very close to default back

in 2010. We had the most explosive combination of debt and deficit of

any other European country. We also had a major credibility deficit.

People in Europe did not believe us all round numbers. -- or our

numbers. We had to insure that defaulting would not happen. We

achieve that. In order to get out of this black hole, we need to do

more than just a stop-gap. That requires growth and major

structural changes. That takes time. The markets do not give you the

time. There was an impression that nothing was working. I would agree

that it was a very difficult situation for the Greek debt. We

are not safe. We have a tremendous amount of work to do in order to

ensure that the doubts about our ability to get back on track can be

cast away. Let me ask about the extra money that you have been

loaned. Some think that over the next ten years, you debt burden

will be about 150 % of GDP. You're back more or less to way you work

before the first bale-out. How do you think you're going to be a good

cry your way out of trouble with 150 % debt burden? Everyone knew

when we got into this programme back in 2010 that the economy would

contract in the beginning. If you GDP get smaller, then you debt

compared to it gets higher. This is not a new thing or an unexpected

thing. The market was demanding that we take these tough measures,

knowing that initially you go up before you go down. To ensure this

goes down for good, we are creating primary surpluses in the economy.

To the extent the have deficits, the debt will go up. Over the next

two years, we would turn the deficit into a surplus. No-one

believes that is going to happen. You're in your for the year of

contraction and planning to slash the economy by a third. It has only

been a year and a half of the programme being applied. In terms

of Greece been in recession, it has been for years. That is true.

Before the programme began, we had started to experience a financial

crisis. We reduced the deficit by 5% at this point. It was 15.

Something. No other country has been able to reduce the deficit by

that much. I cannot do anything in this interview other than try to

stick back by my record, such as it is, and try to convince people that

we are not a government with no political will. We are not a people

are incapable of taking a sacrifice. We had exhibited the will and

capacity to make changes. You had say you had exhibited the will. A

lot of people say that is precisely Grace's historical problem --

Greece's. Why should we believe you this time? Like I said, in the past

year there has been a cultural revolution in Greece. Before the

programmes and austerity measures and loans, people said enough was

enough. They did not want a country that was inefficient. We were to

get rid of the bureaucracy. We would meritocracy in the system. We

were to open up closed professions and allow fresh air to come in and

give young people opportunities. These measures have already been

applied in a remarkable way. Have you started collecting taxes?

Absolutely. Although we lay in a recession last year, we increased

the revenues of the Government compared to the GDP more than any

other country in the year. That is because we applied taxes in a more

tough away. We do have tax evasion in Greece. It is a major problem.

Let me take one specific example of tax evasion. It is widely believed

that all 300 members of the Greek parliament had declared their real

value of their houses had to be much lower than the computer

generated official value. In other words, they are at lying to evade

taxes. The reason I pick on the MPs is that if he were to set an

example, why not start at the top? We are starting at the top. There

is a new tax law in place and another one coming in a few months.

It is taxing property. In other words, you look at what each person

has anti-tax them accordingly. Unita the very creative to change

the tax system. Changing the culture is the important thing.

What we have now is a small revolution. People do recognise

that there is a problem. They realise paying their dues to the

Government is the best way to insure that their families will

have a better future. This takes time, but I assure you we are in a

better part. The tax system will be more fair. The rich will pay more

and the poor will pay less. Let me ask you about the European role and

outside agencies. Do you think that your case is unique, or do you

think that there is a wider problem across Europe? Europe thinks there

is a problem. Since we have gone to the mechanism, portal Guardian,

island garden. We are talking about huge economies. Spain has been

attacked. Europe realises that that scapegoating Greece is not the

answer to the problem. We have structural problems in Europe to

deal with as well. Kris Massie did have an explosive combination of

debt and deficits -- Greece. Cutting down on that and coming to

surpasses requires a particularly high level of sacrifice. That is

not easy. It is happening there. We met through a phase would be a

punishment rhetoric. We will look at the Greeks, all the terrible

things, and I agree. In order for that to change, there has to be

sacrificed. The great people are being punished in that sense. Can

we move away from that to a level of solidarity? It will be much

better for everyone. Both are as receiving the loans, of which we

are we paying every year. Solidarity also means punishment

for the rest of Europe. Why should the Germans stump up feel your

tremendous inefficiency? If you focus on that issue, why should

anyone else suffer for a house in Yervoy I would answer as follows.

It is not a suffering, it is loans and a pretty hefty interest rate.

The people of Europe, to whom we are grateful, are learning us money.

They are not losing it. These are not handouts. The reason that

everyone has to participate in these is because the crisis in

Portugal and Ireland prove that this is not just simply a great

issue. We do not have a monetary arm. This is crazy. You think there

needs to be greater fiscal unity? No just me, at the EU does as well.

We have packages coming through that make us try to co-ordinate

fiscal policies together. Is there not a danger that if you decide to

impose economic union on your country's, they will be a greater

destruction between the rollers and the rolled? Are is always a danger

like this. The question is how to avoid the dangers. This is why I

said at the beginning why I think a fiscal union that tries to emulate

one model upon everyone will not work. A model that puts bulls for

everyone, in terms of debts, deficits and all of that, and also

invests in the competitive Infanta just of growth in each country

would be remarkably good. I wish that we had tighter supervision and

economic governance years ago. The finances would not have gone to the

position that they did, had there been more and European supervision.

It is not just me. I think It is not just three, four years

ago. The accepted version of events now is that essentially, you went

into the euro on a liar. You were not meeting the criteria. It was

your party that took Greece into the euro. D now except that you did

that on a lie? -- do you now accept? Absolutely not. That is not

true. And when they were checking to see the figures from the country

coming in they would look at the figures, focus on them. The problem

was that after that happened, not just for Greece but other countries.

Germany and France were the first countries to overstep the

boundaries and there was not a tough decision taken at the time.

At the time, every single figures indicates that we met the criteria,

so Fisher me. The truth it is that whether the figures were accurate

or not, you went on a massive splurging terms of, suddenly you

were allowed to have low interest rates, inflation. You do have to

take some responsibility for this. I will take any responsibility you

want me to take. This is not the debate that I wish to have now.

is key because people want to know whether... If you want me to answer

it, I will answer it this way - in the past five years, not 10, the

debt of Greece doubled by, approximately 300 billion. Off it

is important to emphasise now not a blame game, whose fault it was but

instead what do we need to do in terms of holding hands and not

pointing fingers. I make every effort in my country as well as in

international meetings to communicate to people that the

Greek people, political parties are in agreement on some major changes.

The privatisations are very painful but necessary. Can you name a

country that has been able to overcome a competitiveness problem

and a debt problem by not devaluing? I do not know how many

countries have devalued and escaped that that had characteristics close

to comparable to Greece. Argentina. Not even close. Probably in a

better situation. I will give you a quote from the former chief

economist from the IMF. He said that the main difference between

Greece and Argentina is that Greece is more indebted, less competitive

and is in much worse shape than Argentina. Argentina of course had

to take another tight austerity package but then was able to

devalue the currency. Not. That is right. We have

something that they do not have. Because we belong to the Dureau

union, -- the EU, we have, as opposed to Argentina, the ability

to make the necessary changes without the overheads of default.

The responsibility is ours for now. My answer to that is that we have

proven that we can. We have just passed a packet of extremely tough

measures. People are not in the streets and celebrating about them.

We are implementing them with the support of our allies. It is not

just good for the whole of the Eurozone, it is a very good for any

country not in the euro which trades with the euro. It is not

simply for cars but the sake of Germany, the UK. -- the sake of

simply our. -- simply us. There are suggestions that the Eurozone will

break up, probably by 2013. Is there not a small part of you, of

course you will talk up the chances of you - is there not a small part

of you that thinks it could yet end up with a break-up of the euro.

Not a small part of it. I wish I could say yes because I think that

is the answer you want but the answer is no. I have been living in

the world in which for the past 1.5 years I read newspapers that

predict the gloom and doom for my country and the Eurozone. The euro,

even in its worst possible crisis in history is an extremely strong

currency that has lost maybe 10 cents in the past year, maybe 15. I

look at a euro that has not suffered almost at all. I look a

country like Greece which in spite of this has not collapsed. There

are predictions every day it will. Look, what I am asking for - I do

not want anyone to give me a blank cheque, I want people to take me at

face value. Watch me closely, judge me however give me the chance to

prove - because the changes he take some time - to prove what I say. I

have predictions that we will fail. The only thing that can be created

is the danger of a self-fulfilling prophecy. That is what is happening

on the streets at the moment. It has been said that the country will

explode, public reaction. It is all very well to say that you are

committed. There is you dangle on the streets of Greece. -- there is

huge anger. I have tried to brewers with facts that we do have the will.

Click tried to prove with facts. -- tried to prove. If you look at the

changes that Greece is making you will find no other country in the

history of Europe, I would say the world but let me not jump that much,

that has with such austerity, with complaints, people in the streets

but in a sense with the in vast majority of people saying that we

need a lot of those changes. There are unfairness as in these

decisions, no doubt about it. -- there is unfairness. And I do not

want to predict what people will do and say. You would probably react

much worse. You see a television shot of an angry person and I can

tell you from the fact that we will not back off from our commitment.

We are receiving that from our partners, we are grateful for the

lions, we will make the changes to make our economy competitive. I

hope that if we meet in one year, I can look at you in the eye and

proudly say that I have you think we did OK. Stavros Lambrinidis,

It has been a hot and humid start to the week. The warm weather

remains with us through the night. It is quite humid and Mudgee --

muggy. A band of rain is working across Britain but most of the

heavy stuff has been into the eastern side of Scotland. By eight

o'clock it should be largely dry across Wales. A similar story for

Northern Ireland. Some brightness developing later on and just the

odd spot of rain. In the east of Scotland, a band of rain. That will

move into the north-west of England with the odd heavy burst of rain.

North-eastern parts of should be dry. Why not two showers and in the

south. -- one, two showers. The rain band will continue to move to

the north-eastern corner. Dry across England as we head into

lunchtime and the afternoon. The rain across the north-east and the

Northern Isles. 1, two showers into the afternoon. They will be quite

isolated. We will see the hot weather again concentrated in the

south-east. Highs of 28-29 and warmer in the north. Through

Tuesday the showers will tend to move away and a dry night but humid.

A mild start to the day on Wednesday and it could be the

hottest day of the week. Good sunshine and some showers with some