Greek debt 'out of control

The dynamics of Greece's huge foreign debt has run "out of control," and government efforts to repair the country's crippled economy have proved unsuccessful, the Greek parliamentary budget committee said in its report issued on Wednesday. "The steep debt rise, high primary deficit ... have exacerbated to the maximum the dynamics of debt, which is out of control," the report said. "It is clear that the country's problem is not just the size of the public debt but the inability to consolidate the current fiscal management," it said. "Despite gigantic effort for fiscal adjustment, no primary surplus has been achieved, on the contrary the primary deficit widens." The rising debt, which is currently estimated at more than 350 billion euros ($503 billion), coupled with ineffective anti-crisis measures are likely to neutralize benefits from a new EU bailout, the report said. The EU approved in late July the allocation of a $109-billion loan to Greece in addition to the initial aid package of $110 billion approved in May 2010. Greece has promised to implement massive budget cuts in exchange. However, according to the Greek Finance Ministry, the country's budget deficit increased to 15.5 billion euros (more than $22 billion) in January-July 2011 from 12.42 billion euros ($17.8 billion) in the same period on 2010. Budget incomes decreased by 6.4 percent, while expenditures rose by 7.1 percent in the first seven month of 2011.