Greece's slump will be 'smaller than forecast': PM

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Greece's recession will be less acute than expected this year, the country's prime minister said on Saturday, helping Athens meet the targets of two multi-billion-euro foreign bailouts keeping its economy afloat.

Greece's European Union and International Monetary Fund lenders project the economy will shrink 4.2 percent this year after contracting 6.4 percent in 2012.

But Antonis Samaras said the 2013 slump would be "smaller than forecast."

(Read more: Greece should never have been allowed to join euro: Merkel)

In a sign the country's six-year recession may be bottoming out, data earlier this week showed Greece's economy shrank 3.8 percent in the second quarter, helped by a rebound in tourism. That was the narrowest annual decline in nearly three years.

Speaking at a trade fair in Greece's second city of Thessaloniki, Samaris also said the country would beat this year's main fiscal target of achieving a primary budget surplus, allowing it to seek further debt relief from its euro zone partners as agreed with its lenders last year.

The primary budget balance excludes debt financing.

Excluded from financial markets since 2010, the country has been kept afloat and inside the euro zone with over 200 billion euros ($263.5 billion) in rescue loans from the European Union and the International Monetary Fund.

The euro zone is likely to agree to further international financing in November. The IMF and Greece estimate that Athens will need an extra 10-11 billion euros in 2014-2015.

Positive growth rates and a primary surplus would allow Athens to return to bond markets, Greek officials have said.

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