By MATINA STEVIS And SERENA RUFFONI
BRUSSELS—Greece shouldn't need more money if it sticks to its ambitious program of economic overhauls, the European Commission says in the draft of a report on the deeply indebted country.
Commission President José Manuel Barroso is to present the 41-page document to the European Parliament on Wednesday. It largely repackages existing assistance for Greece and offers detailed analysis of the changes Athens is expected to make over the next few years.
EU officials had warned that the report, pitched by the commission as a growth plan, would contain no provision for further funds for Athens. By detailing the overhaul efforts and assistance under way, Brussels hoped to show their Greek policy amounts to more than simple austerity, officials said.
According to a second draft document, Mr. Barroso is set to tell the European Parliament on Wednesday that "the people of Greece do not stand alone in their efforts to return the country to growth and jobs."
He will say that the total of funds devoted to Greece, including both bailouts and other EU funds, totals €380 billion ($496 billion) and that "if the Greek people and…institutions embrace the priority actions identified by the Commission today, we can get Greece back on track and make a real difference to people's lives."
Concern is mounting ahead of Greek elections on May 6 that the economic measures are leading the country deeper into recession. The draft urges the next Greek government to stick to the program as agreed.
"There is no need for a new program on top of what has already been agreed" from the troika of official lenders—the European Central Bank, the commission and the International Monetary Fund, the report said. It will be sent to other EU institutions.
The draft also said Greece will need to implement additional fiscal measures in 2013 and 2014 to reach a sustainable debt-to-GDP target of around 117% by 2020.
The paper acknowledged Greece has received less than half the more than €20 billion in EU funds earmarked for it between 2007-2013. That is mainly because of difficulty identifying projects that meet conditions attached to EU spending.
"This implies significant unused capacity to boost demand and investment and create employment in the short term, while laying the foundations for sustainable growth in the future," the paper said.
Among the projects it says Greece could benefit from if these resources are tapped are developing transport networks, exploiting tourism and improving public administration.
"The economic transformation of Greece will not be completed overnight, but significant steps can be expected already in 2012," the report says. "Deep structural reform and the correction of imbalances that have built up over many years will take time but actions spelled out in this Communication should pave the way for recovery and lead to a more dynamic, modern, innovative, sustainable and fair Greece."
At the same time, the report warns that in order for Greece to restore competitiveness in its economy it needs to continue on a policy of deep internal devaluation. It also sets out the immediate obstacles the new government will face as soon as it takes office, including identifying new budget cuts, implementing legislated labor-market overhauls and presenting a "timetable for an overhaul of the national collective agreement for the wage-setting system…by end July 2012."
Specifically, the communication says that Greece should "aim at reducing nominal unit labor costs in the business economy by 15% in 2012-2014."
The document says that its purpose was "to highlight the positive impact that the effective implementation of the Second Economic Adjustment Programme can have by laying the foundations for growth, investment and social renewal"
This is a more optimistic message than the one presented by Jorg Asmussen, the German member of the European Central Bank executive board who, in a hearing at the European Parliament in March, told deputies "there is a chance the Greek program can work."
Write to Matina Stevis at matina.stevis@dowjones.com
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