Obama calls on Greece to balance growth, austerity

WASHINGTON (AP) ― President Barack Obama called on Greece Thursday to balance austerity with growth as it seeks to recover from financial crisis, invoking a need for the Greek people to “see a light at the end of the tunnel.”

Capping a meeting at the White House, Obama commended Greek Prime Minister Antonis Samaras for pursuing bold, sweeping structural reforms to deal with its debt burden. The two leaders said they agreed that at the same time, Greece must find ways to grow its economy and create jobs to combat harrowing unemployment.

“We know from history that those countries that are growing, those countries where employment is high and people are increasing their productivity ... have an easier time reducing their debt burden than those countries where people are feeling hopeless,” Obama said.

The Greek prime minister said his citizens have made huge sacrifices, but that those sacrifices are “not going to be in vain.” He said if and when Greece overcomes its economic challenges, it will be European success story ― a nod to the major international assistance provided to Greece and the parallel debt struggles faced by other European Union nations.

Greece is seeking to pull itself out of a 6-year-old recession but still faces major economic troubles. Since 2010, Greece has been surviving on money from a $319 billion bailout package put together by the Washington-based International Monetary Fund and European lenders.

Accentuating the dire joblessness plaguing the nation, new government data, released as Samaras prepared to meet with Obama, showed unemployment in Greece hitting a record high of 27.6 percent in May. For youth, the jobless rate approached 65 percent.

“The emphasis has to be on growth and on the creation of new jobs ― especially for the youth,” he said.

Obama’s message to Samaras echoed the cries in Greece that austerity measures imposed by other European nations as a condition for bailouts has been too much, too fast.

Germany and other EU nations that had to bail out their neighbors to prevent further damage to the regional economy have pressed Greece and other high-debt nations to focus on reducing their debt to restore market confidence and lower government borrowing costs. But the Obama administration has argued those efforts must be tempered by more stimulus to boost growth and counter the high unemployment ― and to increase global demand.

The IMF said last week that Greece has made “exceptional” progress in stabilizing its finances but still needs to undertake major structural changes to its economy, such as collecting more taxes and selling off state-owned enterprises to raise more revenue.