Greece's fiscal requirements by 2014 under existing accords

(ATHENS) - Greece is bound under its loan agreement with the EU and the IMF to bring its public deficit to below 3.0 percent of output by 2014 to continue receiving bankruptcy-saving funds.

The crisis-stricken eurozone member in February signed the EU's new fiscal treaty introducing "golden rules" to make balanced budgets mandatory.

Athens has pledged to reduce its public deficit to 7.3 percent this year, 4.6 percent in 2013 and 2.1 percent in 2014.

The public debt -- slashed by about a third earlier this year thanks to a writeoff of bonds held by private creditors -- is to reach 161.4 of output in 2012, 165.4 percent in 2013 and then decline to 162.1 percent in 2014.

To achieve these targets, it is necessary to find 11.5 billion euros ($14.3 billion) in savings during 2013 and 2014.

The savings plan is expected to be finalised by early September, when experts from the so-called troika of creditors -- the EU, IMF and the European Central Bank -- are scheduled to conclude an audit into Greece's finances and reforms.

Greece is also required to reduce its state payroll by 150,000 people by 2015 -- a process that began haltingly last year -- and sell 19 billion euros worth of state assets by the same year.

The former head of Greece's privatisation fund, who resigned last month, said his agency had managed to conclude just four privatisations worth 1.8 billion euros ($2.2 billion) in 11 months of operation.

In return for the overhaul, Greece is to receive 130 billion euros in EU-IMF loans. It received some 73 billion euros under a first package that began in 2010.

The loan agreement -- known here as the 'memorandum' -- forecasts a primary surplus of 1.8 percent of output in 2013 and a 4.5-percent surplus in 2014.

A primary deficit of 1.0 percent is expected this year.

But the loan agreement's forecasts have fallen short every year.

For this year, it had foreseen Greece's economy contracting by 4.7 percent. The new coalition government headed by Antonis Samaras says this will be closer to 7.0 percent.

Samaras and his political allies are seeking to extend Greece's fiscal adjustment period by at least two years to 2016, to soften the blow on a population already labouring under a third year of austerity.

The loan agreement includes a provision for extending the period for adjustment in cases of a deeper-than-expected recession.