Action plan with four pillars

Proposal for Next Generation EU fund eyes digital, green and reformed economic model

The countdown to the launch of one of the most ambitious plans ever designed for the Greek economy began last week, with the submission to the European Commission of the draft action plan for the utilization of the Next Generation EU fund’s resources.

Based on four key pillars, the plan’s goal is to radically transform the model of the Greek economy, so as not only to bolster its recovery from the health crisis, but also to shift to a new, export-minded, competitive, digitally enhanced and environmentally friendly template.

The new paradigm includes measures to curb the shadow economy, while also including a growth-friendly tax system and an efficient social protection network, according to government officials who were involved in preparing the blueprint, taking into account the proposals of the Pissarides Committee that will be presented today.

The draft proposal foresees investments and reforms going hand-in-hand, facilitating the implementation of reforms as they will be financially supported. For instance, the program incorporates the government’s social security reform through a system of auxiliary pensions. Another example is a tax reform that will also include the introduction of incentives for online transactions. Sources say incentives may be introduced in the third quarter of 2021 in the form of reduced tax for electronic transactions related to specific professional categories that tend to evade taxation.

The first of the draft’s four main pillars concerns the green transition: The power interconnection of Greek islands, the installation of smart energy counters, etc. Digital transition forms the second pillar, providing for the provisional installation of fiber-optics in buildings, the development of 5G networks on all highways and the digital transformation of firms.

The third pillar concerns employment, skills and social cohesion, through the labor market and pension reforms, the development of digital skills and many other actions. Finally, the fourth regards private investment and institutional reform, including the combatting of tax evasion.