In­vest­ments took a dive in Q4

Rise in pri­vate con­sump­tion, late spurt in ex­ports not enough to pre­vent econ­omy from con­tract­ing in 2016

Kathimerini English - - Focus -

The neg­a­tive re­sult of the re­vised eco­nomic figures for 2016, which pointed to a 0.05 per­cent yearly con­trac­tion on Mon­day, was the out­come of the de­cline in in­vest­ments that off­set the rise in con­sump­tion, along with the net neg­a­tive im­pact of the ex­ter­nal trade. That con­trac­tion will also have an ad­verse ef­fect on 2017, too, which is al­ready show­ing wor­ry­ing signs.

Ac­cord­ing to Hel­lenic Sta­tis­ti­cal Au­thor­ity (ELSTAT) data pro­cessed by Eurobank, pri­vate con­sump­tion in the last quar­ter of 2016 in­creased 1.1 per­cent from the same pe­riod in 2015, for a to­tal an­nual in­crease of 1.4 per­cent in 2016. In con­trast, public con­sump­tion fell due to the state’s fail­ure to pay its dues to sup­pli­ers.

In­vest­ments posted a ma­jor de­cline in Q4, amount­ing to 30.7 per­cent year-on-year, turn­ing the fig­ure for the year as a whole into a 0.9 per­cent drop.

Ex­ports in­creased 5.7 per­cent in the Oc­to­ber-De­cem­ber 2016 pe­riod from the year be­fore, but over­all in 2016 they de­clined 1.5 per­cent from 2015. Im­ports grew 3 per­cent in Q4 year-on-year and by 0.5 per­cent through­out 2016.

Ac­cord­ing to Eurobank’s chief econ­o­mist Pla­ton Monokrous­sos, the figures fur­ther point to a neg­a­tive car­ry­over ef­fect into 2017 by 0.6 per­cent of gross do­mes­tic prod­uct. This ef­fect – com­bined with the ex­cep­tion­ally ad­verse weather con­di­tions at the start of the year and the in­creased un­cer­tainty re­gard­ing the com­ple­tion of the sec­ond bailout re­view – does not au­gur well for this year.

Sources say that the big­gest im­pact on the down­ward re­vi­sion of the GDP data for Q4 came from build­ing per­mits, which posted a 12 per­cent de­cline, mar­itime trans­port ser­vices, which showed an 11.5 per­cent drop, and le­gal and ac- 1.0576 count­ing ser­vices, which shrank 1.5 per­cent.

The ELSTAT state­ment on Mon­day noted that its down­ward ad­just­ment of the pre­vi­ous pro­jec­tion was due to the “in­cor­po­ra­tion of figures that were not avail­able dur­ing the first es­ti­mate. These figures are either monthly, such as De­cem­ber’s ex­ter­nal trade data, or quar­terly, such as the ser­vice sec­tor turnover in­dices and the man­power sur­vey data.”

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