Greece starts privatizing to cut debt

ATHENS, Greece – Greece will “immediately” start selling state assets in several major enterprises and take more than 6 billion euros in additional fiscal measures this year to tackle its debt crisis, the finance minister said Monday after a seven-hour emergency Cabinet meeting.

Prime Minister George Papandreou chaired the meeting as Greece’s borrowing costs surged, with yields rising above 17 percent for Greek 10-year bonds, hitting a new record margin – or spread – over the benchmark German rate.

The measures were aimed at easing strong criticism from the European Union, which is demanding faster reforms before considering the possibility of additional help for Greece, which is facing a critical funding gap in 2012.

“The government is determined to continue and accelerate the path of fiscal consolidation and structural reforms,” Finance Minister George Papaconstantinou said.

Greece has been dependent for the past year on a 110-billion-euro package of bailout loans from the EU and International Monetary Fund, and has been implementing strict austerity measures in return.

Papaconstantinou warned that Greece faces default unless it secures the next installment of international rescue loans, worth 12 billion euros, late next month.

Greece has been steadily slipping on its targets, and many analysts doubt the country will be able to pull itself out of the crisis by the time the bailout loans run out in 2013 without extra outside help.