Greek PM rules out new austerity moves

The Greek government is planning no new austerity measures as part of efforts to pull the country out of debt, the prime minister said Sunday.

George Papandreou said the government was on track to meet targets for reducing its deficit by nearly 40 per cent this year.

His statement follows a day of protests Saturday in Thessaloniki. About 20,000 people gathered in three separate demonstrations to denounce the austerity measures, ahead of the prime minister's economic policy speech in the northern port city.

"We will not need any new measures," Papandreou said Sunday, and reiterated that Greece did not plan to restructure its debt.

In exchange for 110 billion euros ($144 billion Cdn) in rescue loans over three years from the International Monetary Fund and some EU countries, Greece has implemented strict fiscal control in an effort to reduce the budget deficit from 13.6 per cent of annual output in 2009 to 8.1 per cent this year.

Unions have been angered, however, by austerity measures that have included cutting salaries and raising taxes.

IMF and EU inspectors are due in Athens next week to review Greece's progress in overhauling its economy, while the country is due to receive a second installment of loans worth nine billion euros ($11.8 billion Cdn).