:00:02. > :00:11.Welcome to HARDTalk. The pattern of the recent past seems to have been
:00:11. > :00:21.blown and panic. -- gloom. You pronounce that you are going to
:00:21. > :00:21.
:00:21. > :00:25.change your ways in Greece. What is different this time round?
:00:25. > :00:35.difference this time is that the decisions in Europe are far recent
:00:35. > :00:40.-- far reaching and a long-term. We are at a bottomless barrel. That is
:00:40. > :00:44.hugely important. Both for economic reasons and psychological reasons.
:00:44. > :00:48.Economies are psychologies. Up to now, people in Greece felt they
:00:48. > :00:52.were making huge sacrifices, and they are, but without a light at
:00:52. > :00:57.the end of the tunnel. People in Europe felt that there were
:00:57. > :01:01.throwing water in a barrel without seeing any results. The reason for
:01:01. > :01:08.this was not that Greece was not what it was -- doing what it was
:01:08. > :01:14.doing. In my view, it was because this debt problem was not simply a
:01:14. > :01:19.great one. It revealed itself as a European one. It needed a European
:01:19. > :01:23.solution to be able to stabilise things. I believe we have the
:01:23. > :01:33.stability now and the breathing space. We are able to implement
:01:33. > :01:43.
:01:43. > :01:49.extremely tough measures and Europe Do you think that we're done his in
:01:49. > :01:56.effect a target of old? No, I think we were very close to default back
:01:56. > :02:03.in 2010. We had the most explosive combination of debt and deficit of
:02:03. > :02:10.any other European country. We also had a major credibility deficit.
:02:10. > :02:18.People in Europe did not believe us all round numbers. -- or our
:02:18. > :02:24.numbers. We had to insure that defaulting would not happen. We
:02:25. > :02:30.achieve that. In order to get out of this black hole, we need to do
:02:30. > :02:34.more than just a stop-gap. That requires growth and major
:02:34. > :02:42.structural changes. That takes time. The markets do not give you the
:02:42. > :02:49.time. There was an impression that nothing was working. I would agree
:02:49. > :02:53.that it was a very difficult situation for the Greek debt. We
:02:53. > :02:58.are not safe. We have a tremendous amount of work to do in order to
:02:58. > :03:03.ensure that the doubts about our ability to get back on track can be
:03:03. > :03:10.cast away. Let me ask about the extra money that you have been
:03:10. > :03:19.loaned. Some think that over the next ten years, you debt burden
:03:19. > :03:24.will be about 150 % of GDP. You're back more or less to way you work
:03:24. > :03:33.before the first bale-out. How do you think you're going to be a good
:03:33. > :03:40.cry your way out of trouble with 150 % debt burden? Everyone knew
:03:40. > :03:45.when we got into this programme back in 2010 that the economy would
:03:45. > :03:50.contract in the beginning. If you GDP get smaller, then you debt
:03:50. > :03:55.compared to it gets higher. This is not a new thing or an unexpected
:03:55. > :04:01.thing. The market was demanding that we take these tough measures,
:04:01. > :04:11.knowing that initially you go up before you go down. To ensure this
:04:11. > :04:16.goes down for good, we are creating primary surpluses in the economy.
:04:16. > :04:20.To the extent the have deficits, the debt will go up. Over the next
:04:20. > :04:23.two years, we would turn the deficit into a surplus. No-one
:04:23. > :04:30.believes that is going to happen. You're in your for the year of
:04:30. > :04:34.contraction and planning to slash the economy by a third. It has only
:04:34. > :04:40.been a year and a half of the programme being applied. In terms
:04:40. > :04:46.of Greece been in recession, it has been for years. That is true.
:04:46. > :04:55.Before the programme began, we had started to experience a financial
:04:55. > :05:02.crisis. We reduced the deficit by 5% at this point. It was 15.
:05:02. > :05:09.Something. No other country has been able to reduce the deficit by
:05:09. > :05:15.that much. I cannot do anything in this interview other than try to
:05:15. > :05:19.stick back by my record, such as it is, and try to convince people that
:05:19. > :05:27.we are not a government with no political will. We are not a people
:05:27. > :05:32.are incapable of taking a sacrifice. We had exhibited the will and
:05:32. > :05:40.capacity to make changes. You had say you had exhibited the will. A
:05:40. > :05:50.lot of people say that is precisely Grace's historical problem --
:05:50. > :05:53.
:05:53. > :06:01.Greece's. Why should we believe you this time? Like I said, in the past
:06:01. > :06:05.year there has been a cultural revolution in Greece. Before the
:06:05. > :06:13.programmes and austerity measures and loans, people said enough was
:06:13. > :06:19.enough. They did not want a country that was inefficient. We were to
:06:19. > :06:23.get rid of the bureaucracy. We would meritocracy in the system. We
:06:23. > :06:31.were to open up closed professions and allow fresh air to come in and
:06:31. > :06:35.give young people opportunities. These measures have already been
:06:35. > :06:40.applied in a remarkable way. Have you started collecting taxes?
:06:40. > :06:44.Absolutely. Although we lay in a recession last year, we increased
:06:44. > :06:49.the revenues of the Government compared to the GDP more than any
:06:49. > :06:56.other country in the year. That is because we applied taxes in a more
:06:56. > :07:04.tough away. We do have tax evasion in Greece. It is a major problem.
:07:04. > :07:09.Let me take one specific example of tax evasion. It is widely believed
:07:09. > :07:12.that all 300 members of the Greek parliament had declared their real
:07:12. > :07:20.value of their houses had to be much lower than the computer
:07:20. > :07:25.generated official value. In other words, they are at lying to evade
:07:25. > :07:32.taxes. The reason I pick on the MPs is that if he were to set an
:07:32. > :07:37.example, why not start at the top? We are starting at the top. There
:07:37. > :07:45.is a new tax law in place and another one coming in a few months.
:07:45. > :07:52.It is taxing property. In other words, you look at what each person
:07:52. > :07:58.has anti-tax them accordingly. Unita the very creative to change
:07:58. > :08:07.the tax system. Changing the culture is the important thing.
:08:07. > :08:15.What we have now is a small revolution. People do recognise
:08:15. > :08:20.that there is a problem. They realise paying their dues to the
:08:20. > :08:29.Government is the best way to insure that their families will
:08:29. > :08:33.have a better future. This takes time, but I assure you we are in a
:08:33. > :08:42.better part. The tax system will be more fair. The rich will pay more
:08:42. > :08:52.and the poor will pay less. Let me ask you about the European role and
:08:52. > :08:52.
:08:52. > :09:02.outside agencies. Do you think that your case is unique, or do you
:09:02. > :09:03.
:09:03. > :09:13.think that there is a wider problem across Europe? Europe thinks there
:09:13. > :09:14.
:09:14. > :09:24.is a problem. Since we have gone to the mechanism, portal Guardian,
:09:24. > :09:26.
:09:26. > :09:32.island garden. We are talking about huge economies. Spain has been
:09:32. > :09:36.attacked. Europe realises that that scapegoating Greece is not the
:09:36. > :09:42.answer to the problem. We have structural problems in Europe to
:09:42. > :09:52.deal with as well. Kris Massie did have an explosive combination of
:09:52. > :09:53.
:09:53. > :09:58.debt and deficits -- Greece. Cutting down on that and coming to
:09:58. > :10:04.surpasses requires a particularly high level of sacrifice. That is
:10:04. > :10:11.not easy. It is happening there. We met through a phase would be a
:10:11. > :10:15.punishment rhetoric. We will look at the Greeks, all the terrible
:10:15. > :10:21.things, and I agree. In order for that to change, there has to be
:10:21. > :10:28.sacrificed. The great people are being punished in that sense. Can
:10:28. > :10:33.we move away from that to a level of solidarity? It will be much
:10:33. > :10:38.better for everyone. Both are as receiving the loans, of which we
:10:38. > :10:46.are we paying every year. Solidarity also means punishment
:10:46. > :10:56.for the rest of Europe. Why should the Germans stump up feel your
:10:56. > :10:57.
:10:57. > :11:03.tremendous inefficiency? If you focus on that issue, why should
:11:03. > :11:09.anyone else suffer for a house in Yervoy I would answer as follows.
:11:09. > :11:18.It is not a suffering, it is loans and a pretty hefty interest rate.
:11:18. > :11:24.The people of Europe, to whom we are grateful, are learning us money.
:11:24. > :11:31.They are not losing it. These are not handouts. The reason that
:11:31. > :11:36.everyone has to participate in these is because the crisis in
:11:36. > :11:44.Portugal and Ireland prove that this is not just simply a great
:11:44. > :11:52.issue. We do not have a monetary arm. This is crazy. You think there
:11:52. > :11:55.needs to be greater fiscal unity? No just me, at the EU does as well.
:11:55. > :12:03.We have packages coming through that make us try to co-ordinate
:12:03. > :12:10.fiscal policies together. Is there not a danger that if you decide to
:12:10. > :12:16.impose economic union on your country's, they will be a greater
:12:16. > :12:25.destruction between the rollers and the rolled? Are is always a danger
:12:25. > :12:28.like this. The question is how to avoid the dangers. This is why I
:12:28. > :12:35.said at the beginning why I think a fiscal union that tries to emulate
:12:35. > :12:42.one model upon everyone will not work. A model that puts bulls for
:12:42. > :12:45.everyone, in terms of debts, deficits and all of that, and also
:12:45. > :12:52.invests in the competitive Infanta just of growth in each country
:12:52. > :12:59.would be remarkably good. I wish that we had tighter supervision and
:12:59. > :13:03.economic governance years ago. The finances would not have gone to the
:13:03. > :13:13.position that they did, had there been more and European supervision.
:13:13. > :13:14.
:13:14. > :13:19.It is not just me. I think It is not just three, four years
:13:20. > :13:27.ago. The accepted version of events now is that essentially, you went
:13:27. > :13:33.into the euro on a liar. You were not meeting the criteria. It was
:13:33. > :13:43.your party that took Greece into the euro. D now except that you did
:13:43. > :13:47.
:13:47. > :13:52.that on a lie? -- do you now accept? Absolutely not. That is not
:13:52. > :13:57.true. And when they were checking to see the figures from the country
:13:57. > :14:03.coming in they would look at the figures, focus on them. The problem
:14:03. > :14:10.was that after that happened, not just for Greece but other countries.
:14:10. > :14:15.Germany and France were the first countries to overstep the
:14:15. > :14:25.boundaries and there was not a tough decision taken at the time.
:14:25. > :14:26.
:14:26. > :14:34.At the time, every single figures indicates that we met the criteria,
:14:34. > :14:40.so Fisher me. The truth it is that whether the figures were accurate
:14:40. > :14:49.or not, you went on a massive splurging terms of, suddenly you
:14:49. > :14:55.were allowed to have low interest rates, inflation. You do have to
:14:55. > :15:00.take some responsibility for this. I will take any responsibility you
:15:00. > :15:05.want me to take. This is not the debate that I wish to have now.
:15:05. > :15:11.is key because people want to know whether... If you want me to answer
:15:11. > :15:21.it, I will answer it this way - in the past five years, not 10, the
:15:21. > :15:26.
:15:26. > :15:31.debt of Greece doubled by, approximately 300 billion. Off it
:15:31. > :15:36.is important to emphasise now not a blame game, whose fault it was but
:15:36. > :15:41.instead what do we need to do in terms of holding hands and not
:15:41. > :15:45.pointing fingers. I make every effort in my country as well as in
:15:46. > :15:53.international meetings to communicate to people that the
:15:53. > :16:03.Greek people, political parties are in agreement on some major changes.
:16:03. > :16:06.
:16:06. > :16:11.The privatisations are very painful but necessary. Can you name a
:16:11. > :16:20.country that has been able to overcome a competitiveness problem
:16:20. > :16:25.and a debt problem by not devaluing? I do not know how many
:16:25. > :16:34.countries have devalued and escaped that that had characteristics close
:16:34. > :16:39.to comparable to Greece. Argentina. Not even close. Probably in a
:16:39. > :16:43.better situation. I will give you a quote from the former chief
:16:43. > :16:52.economist from the IMF. He said that the main difference between
:16:52. > :16:57.Greece and Argentina is that Greece is more indebted, less competitive
:16:57. > :17:03.and is in much worse shape than Argentina. Argentina of course had
:17:03. > :17:10.to take another tight austerity package but then was able to
:17:10. > :17:20.devalue the currency. Not. That is right. We have
:17:20. > :17:30.something that they do not have. Because we belong to the Dureau
:17:30. > :17:35.union, -- the EU, we have, as opposed to Argentina, the ability
:17:35. > :17:45.to make the necessary changes without the overheads of default.
:17:45. > :17:45.
:17:45. > :17:50.The responsibility is ours for now. My answer to that is that we have
:17:50. > :17:55.proven that we can. We have just passed a packet of extremely tough
:17:55. > :18:01.measures. People are not in the streets and celebrating about them.
:18:01. > :18:06.We are implementing them with the support of our allies. It is not
:18:06. > :18:12.just good for the whole of the Eurozone, it is a very good for any
:18:12. > :18:22.country not in the euro which trades with the euro. It is not
:18:22. > :18:26.
:18:26. > :18:36.simply for cars but the sake of Germany, the UK. -- the sake of
:18:36. > :18:41.
:18:41. > :18:48.simply our. -- simply us. There are suggestions that the Eurozone will
:18:48. > :18:52.break up, probably by 2013. Is there not a small part of you, of
:18:52. > :18:59.course you will talk up the chances of you - is there not a small part
:18:59. > :19:05.of you that thinks it could yet end up with a break-up of the euro.
:19:05. > :19:11.Not a small part of it. I wish I could say yes because I think that
:19:11. > :19:16.is the answer you want but the answer is no. I have been living in
:19:16. > :19:22.the world in which for the past 1.5 years I read newspapers that
:19:22. > :19:26.predict the gloom and doom for my country and the Eurozone. The euro,
:19:26. > :19:35.even in its worst possible crisis in history is an extremely strong
:19:35. > :19:40.currency that has lost maybe 10 cents in the past year, maybe 15. I
:19:40. > :19:48.look at a euro that has not suffered almost at all. I look a
:19:48. > :19:54.country like Greece which in spite of this has not collapsed. There
:19:54. > :19:59.are predictions every day it will. Look, what I am asking for - I do
:19:59. > :20:08.not want anyone to give me a blank cheque, I want people to take me at
:20:08. > :20:18.face value. Watch me closely, judge me however give me the chance to
:20:18. > :20:19.
:20:19. > :20:24.prove - because the changes he take some time - to prove what I say. I
:20:24. > :20:34.have predictions that we will fail. The only thing that can be created
:20:34. > :20:35.
:20:35. > :20:41.is the danger of a self-fulfilling prophecy. That is what is happening
:20:41. > :20:47.on the streets at the moment. It has been said that the country will
:20:47. > :20:57.explode, public reaction. It is all very well to say that you are
:20:57. > :20:57.
:20:57. > :21:07.committed. There is you dangle on the streets of Greece. -- there is
:21:07. > :21:08.
:21:08. > :21:18.huge anger. I have tried to brewers with facts that we do have the will.
:21:18. > :21:24.
:21:24. > :21:27.Click tried to prove with facts. -- tried to prove. If you look at the
:21:27. > :21:35.changes that Greece is making you will find no other country in the
:21:35. > :21:42.history of Europe, I would say the world but let me not jump that much,
:21:42. > :21:47.that has with such austerity, with complaints, people in the streets
:21:47. > :21:54.but in a sense with the in vast majority of people saying that we
:21:54. > :22:03.need a lot of those changes. There are unfairness as in these
:22:03. > :22:10.decisions, no doubt about it. -- there is unfairness. And I do not
:22:10. > :22:20.want to predict what people will do and say. You would probably react
:22:20. > :22:27.
:22:27. > :22:31.much worse. You see a television shot of an angry person and I can
:22:31. > :22:38.tell you from the fact that we will not back off from our commitment.
:22:38. > :22:48.We are receiving that from our partners, we are grateful for the
:22:48. > :22:55.lions, we will make the changes to make our economy competitive. I
:22:55. > :23:02.hope that if we meet in one year, I can look at you in the eye and
:23:02. > :23:12.proudly say that I have you think we did OK. Stavros Lambrinidis,
:23:12. > :23:23.
:23:23. > :23:31.It has been a hot and humid start to the week. The warm weather
:23:31. > :23:38.remains with us through the night. It is quite humid and Mudgee --
:23:38. > :23:44.muggy. A band of rain is working across Britain but most of the
:23:44. > :23:50.heavy stuff has been into the eastern side of Scotland. By eight
:23:50. > :23:55.o'clock it should be largely dry across Wales. A similar story for
:23:56. > :24:05.Northern Ireland. Some brightness developing later on and just the
:24:05. > :24:10.odd spot of rain. In the east of Scotland, a band of rain. That will
:24:10. > :24:16.move into the north-west of England with the odd heavy burst of rain.
:24:16. > :24:26.North-eastern parts of should be dry. Why not two showers and in the
:24:26. > :24:33.
:24:33. > :24:38.south. -- one, two showers. The rain band will continue to move to
:24:38. > :24:42.the north-eastern corner. Dry across England as we head into
:24:42. > :24:50.lunchtime and the afternoon. The rain across the north-east and the
:24:50. > :24:54.Northern Isles. 1, two showers into the afternoon. They will be quite
:24:54. > :25:04.isolated. We will see the hot weather again concentrated in the
:25:04. > :25:04.
:25:04. > :25:14.south-east. Highs of 28-29 and warmer in the north. Through
:25:14. > :25:16.
:25:16. > :25:21.Tuesday the showers will tend to move away and a dry night but humid.
:25:21. > :25:27.A mild start to the day on Wednesday and it could be the
:25:27. > :25:34.hottest day of the week. Good sunshine and some showers with some