Greece keeps 2.7% growth es­ti­mate

The Myanmar Times - - International Business -

GREECE ex­pects to post 2.7 per­cent growth in 2017 af­ter years of nearly con­sec­u­tive re­ces­sion in a bud­get that also pre­dicts an above-tar­get pri­mary sur­plus.

The bud­get, to be voted on by par­lia­ment on De­cem­ber 10, in­cludes ex­tra tax­a­tion on cars, cell­phones, pay TV, fuel, to­bacco, cof­fee and beer.

Greece’s econ­omy this year is set to shrink by 0.3pc according to the lat­est es­ti­mates, con­tin­u­ing a slide un­in­ter­rupted since 2009 ex­cept for one year, 2014.

Un­der the terms of its lat­est EU bailout, Greece must reg­is­ter pri­mary bud­get sur­pluses (be­fore debt ser­vice) of 0.5pc of GDP this year, 1.75pc in 2017 and 3.5pc in 2018.

The bud­get tabled last week said Greece beat its 2016 tar­get by post­ing a 1.09pc pri­mary sur­plus, and will do so again in 2017 with a sur­plus of 2pc.

It kept the growth tar­get of the draft bud­get tabled in Oc­to­ber, but im­proved the sur­plus, which at the time had been listed at 1.8pc.

There are some, in­clud­ing the In­ter­na­tional Mone­tary Fund and Bank of Greece gover­nor Yan­nis Stournaras, who say the 3.5pc tar­get in 2018 is un­re­al­is­tic.

Be­cause of this dif­fer­ence of opin­ion, the IMF has said it won’t give a penny to the lat­est bailout – Greece’s third since 2010 – un­til it sees a con­crete plan from the Euro­peans to cut sub­stan­tially Greece’s mas­sive debt bur­den.

De­spite strong op­po­si­tion by Ger­many, Eurogroup chief Jeroen Di­js­sel­bloem last week said “short­term debt mea­sures” could be dis­cussed in De­cem­ber.

The debt will grow to 315 bil­lion euros (US$334 bil­lion) or around 180pc of out­put this year, the min­istry said.

The Greek govern­ment has un­der­taken to cut the pen­sions and ben­e­fits of civil ser­vants if it fails to reach the tar­gets and to pro­ceed with a con­tro­ver­sial new round of pri­vati­sa­tions. –

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