Greek econ­omy grows for first time in two years

Kuwait Times - - BUSINESS -

The Greek econ­omy posted quar­terly growth for the first time since 2014 in the three months to Septem­ber, fig­ures re­leased yes­ter­day showed. Greece’s gross do­mes­tic prod­uct (GDP) in­creased by 0.5 per­cent from the pre­vi­ous quar­ter, and by 1.5 per­cent from the third quar­ter of 2015, sta­tis­tics bu­reau El­stat said.

The Greek gov­ern­ment ex­pects the Greek econ­omy to con­tract by 0.3 per­cent in the full-year 2016, be­fore re­turn­ing to growth next year when it pre­dicts GDP to surge by 2.7 per­cent.

On Thursday it said the growth dy­namic was now in bet­ter shape than at any point since the fi­nan­cial cri­sis. “The Greek econ­omy has not known a com­pa­ra­ble growth rhythm since the first quar­ter of 2008,” gov­ern­ment spokesman Dim­itris Tzanakopou­los said.

He said Greece was count­ing on debt re­lief to sup­port growth, as well as on Athens gain­ing ac­cess to the Euro­pean Cen­tral Bank’s quan­ti­ta­tive eas­ing pro­gram which in­volves pur­chases of sov­er­eign bonds.

Apart from a brief respite in 2014, the Greek econ­omy has been steadily con­tract­ing since 2008 as the coun­try’s cred­i­tors as well as the Euro­pean Union and the IMF im­posed harsh aus­ter­ity mea­sures ac­com­pa­ny­ing suc­ces­sive bailouts.

Fall­ing salaries and pen­sions com­bined with tax hikes have had a dev­as­tat­ing im­pact on de­mand, par­tic­u­larly con­sumer spend­ing. In May, Greece’s eu­ro­zone part­ners and the IMF agreed in prin­ci­ple to debt re­lief as well as se­ries of short-term mea­sures to be fi­nal­ized in De­cem­ber.

They have not, how­ever, been able to agree on the pace or the scope of long-term debt re­struc­tur­ing. Euro­pean Union heavy­weight Ger­many has pushed back any such deal to end-2018. — AFP

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