Greek austerity plan will work, says OECD

A leading economic thinktank has backed the embattled Greek government by predicting that the country's hugely unpopular austerity measures will work. In its annual analysis, the Paris-based Organisation for Economic Co-operation and Development (OECD) said Greece could look forward to growth, jobs and rising living standards, provided the measures announced by Athens in return for two huge financial bailouts were implemented in full. Angel Gurría, the OECD's secretary general, praised the difficult decisions already taken by the Greek government as he presented the assessment in Athens. The OECD said improved competitiveness and an increase in exports were the first signs that tough measures were turning the economy around, but cautioned that it would be next year before the country emerged from recession. He said: "Reforms carried out over the past year are impressive. This achievement does not always seem to be properly appreciated, in Greece or abroad." Tax increases, spending cuts, and wage reductions and a sweeping privatisation programme have led to violent protests in Greece, with many arguing that the International Monetary Fund and European Union have demanded too high a price for their financial support . Gurría urged the Greek government to hold its nerve, stressing economic success would depend on the strength of the reforms and their successful implementation.