ATHENS–The new government in Greece must put the country’s bailout program back on track and Greeks must back reforms to ensure they succeed, ECB Executive Board Member Joerg Asmussen said on Monday. Although important reforms had been implemented, “many other necessary reforms have not been followed through due to weak program ownership,” Asmussen told a conference here organized by the Economist magazine. “The program is the best option for Greece,” he said, referring to the raft of austerity measures agreed by Athens in return for two rounds of rescue loans and a public debt write-off that have kept the country afloat. The program is helping Greece’s standard of living, he said and the new government “should not waste time” avoiding or loosening it. “Delaying adjustment is risky,” he said, and would increase the debt-to-ratio GDP above the 120 percent by 2020 targeted as part of the rescue program. Adjustment “is also not free”, he stressed and would require additional funding from creditor countries. Asmussen argued that the difficulties Greece was facing “do not stem from the program.”
He said: “They stem from many years of unsustainable economic policies and a reluctance to implement the necessary reforms.” He added: “With or without the program, any Greek government would have to pursue a similar adjustment to bring the economy back on track and restore the confidence of financial markets.” Compared to the situation if Greece had chosen to tackle its problems alone, “the program is actually helping support the Greek people’s standard of living,” Asmussen said. Asmussen spoke just ahead of a visit by auditors from the European Union, International Monetary Fund and ECB who will review Greece’s implementation of the reform program.