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Greek Economy Contracting at Rapid Rate


Greece's central bank says the country's troubled economy is shrinking even faster than first thought.

The bank's governor, George Provopoulos, said Tuesday the Greek economy will contract as much as 5 percent this year - the country's fifth straight year of recession. Just a month ago, the bank had predicted the economy would shrink 4.5 percent.

Provopoulos said that as soon as Greek voters pick a new government in the May 6 elections, the debt-ridden country needs to return quickly to imposing more austerity measures to keep its deficit spending in check.

"In this crucial environment, the Greek economy is called upon to make steady progress. Full readiness is required the very day after the election period ends, so that the war can be won on all fronts, beginning with building an effective and flexible state that serves the competitive functioning of markets and social cohesion," said Provopoulos.

At the demands of its international creditors, Greece already has imposed widespread social spending cuts and eliminated thousands of government jobs in exchange for billions of dollars in debt relief and financial bailouts. But the measures have angered Greeks and prompted frequent strikes and street protests.

Provopoulos said Greeks have an obligation to adhere to the cost-cutting plan.

"If, after the elections, the slightest doubt is cast on the will of the new government and society to carry out the [reform] program, today's positive prospects will be reversed and the country will rapidly find itself in a particularly harmful situation, with a negative effect on the psychology of the citizens," said Provopoulos.

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