BRUSSELS (MNI) – EU officials are helping Greek authorities
negotiate a tax agreement with Switzerland as part of efforts to clamp
down on tax evasion, which costs the Greek economy an estimated E60
billion a year.

Greece has opened negotiations with Switzerland on a bilateral deal
such as those struck earlier this year by Germany and the UK. European
Commission experts are advising Athens on the deal and working to ensure
it complies with EU laws.

A report from European Commission advisors in Athens, released
Thursday, estimates Greece’s unpaid tax bill at E60 billion, of which
E30 billion was being pursued through 165,000 court cases.

About E8 billion of the E30 billion being pursued are seen as
easily recoverable.

Although the report said good progress had been made on identifying
technical assistance priorities regarding Greece’s privatisation
programme, bureaucracy, public works, and tax collection, it also said
that major infrastructure projects, which could have a substantial
impact on GDP, still face big obstacles.

1,400 km of motorway projects, which could create tens of thousands
of jobs and boost GDP by 1.5% to 2%, are struggling because Greece’s
recession has cut estimated traffic flow estimates and made funding more
difficult.

EU officials are helping Athens to find financing and to revise the
projects so that they can start and so that the authorities can avoid
compensation claims from the construction consortia with which contracts
have already been signed.

Another plan, an ambitious scheme to build 10GW of solar power in
Greece, which could be exported to other EU countries and used to help
the EU meet its renewable energy and climate change targets, is also
struggling to get off the ground, because complex rule changes need to
be made to incentive schemes in Greece and countries importing the
electricity.

Commission experts are also helping Greek authorities with aspects
of their troubled privatization programme, with legal, communication,
and strategic advice, particularly concerning real estate sales, which
make up 50% of the assets targeted for privatisation.

Greece recently announced that it had revised its target for
privatization proceeds in the fourth quarter of this year down to E1.3
billion.

–Brussels bureau: +324-952-28374; pkoh@marketnews.com

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