Greece promises primary surplus in 2012

By the Associated Press | September 19, 2011 | 4:15 AM EDT

VOULIAGMENI, Greece (AP) — Greece's finance minister promised Monday to stick with his plan for the country to post a primary surplus in 2012, hours before he was to hold an emergency teleconference with top officials from debt inspectors.

Evangelos Venizelos' target of generating more revenues next year than the country spends, before paying off interest on debts, comes despite the ongoing recession in the crisis-hit country. Greece's economy is expected to contract by about 5.5 percent this year.

Speaking at a conference south of Athens, Venizelos said the 2012 target was vital for Greece to avoid international "blackmail and humiliation."

The government still must live up to its commitment to achieve its 2011 budget deficit goal of 7.6 percent of gross domestic product. When it became obvious earlier this month that there was a more than euro2 billion ($2.75 billion) shortfall in the budget, Greece's creditors — the eurozone member countries, the European Central Bank and the International Monetary Fund — threatened to withhold the sixth installment of a euro110 billion rescue package agreed upon in May 2010.

Without the installment, worth euro8 billion, Greece faces defaulting on its debts by mid-October.

A review by officials from the IMF, ECB and European Commission, collectively known as the 'troika,' was suspended earlier this month amid talk of missed targets. The troika heads had been due to return to the country this week, but have stayed away and will hold a crucial teleconference with Venizelos on Monday afternoon instead.

Prime Minister George Papandreou, who canceled a scheduled trip to Washington and New York on Saturday to remain in Athens for a "critical week," has called a government meeting for after the call.