6 Aug 2010

Strong progress by Greece noted by EU and IMF

7:02 am on 6 August 2010

The European Union and the International Monetary Fund say Greece has made a strong start in implementing an austerity programme designed to tackle the country's huge public debt.

But they warn it still faces significant challenges.

In May, the EU and the IMF agreed to loan Greece 110 billion euros ($US145 billion) over three years.

An IMF official said he was "confident" Greece would get the next instalment.

The BBC reports a loan of 9 billion euros is due to be given to Greece on 13 September, which is dependent upon the government meeting progress targets.

Greece is continuing efforts to make big cuts to government spending, despite a number of violent protests and strikes.

While the IMF and EU welcomed the work Greece had carried out so far, they also warned that "important challenges and risks remain".

While central government spending was now "significantly below budget limits", they noted that local authorities and hospitals were still over-spending.

The Greek government is trying to reduce a national debt that stands at about 115% of its gross domestic output and a public deficit that exceeds 13%.