Exports take growing share of economy
Progress in the indexes of the outward-looking side of the Greek economy, such as exports and the attraction of foreign direct investments, is recorded in the bulletin of the Reforms Observatory of the Center for Planning and Economic Research (KEPE). However, it points out that despite the progress, the distance that separates Greece from the corresponding performances in the European Union remains large.
According to the bulletin, exports of goods and services increased from 19% of GDP in 2009 to 44.9% of GDP in 2023. In the European Union the rate increased from 36.3% of GDP in 2009 to 52.7 % of GDP in 2023.
The distance is greater if the exports of goods are isolated, since services – i.e. tourism – are the Greek economy's strong card. Exports of goods were 8.5% of GDP in 2009 and increased to 22.6% of GDP in 2023. In the European Union, the corresponding percentage increased from 26.9% to 37.1% of GDP.
Gross fixed capital formation started from roughly the same base in 2009: It was 20.8% of GDP in Greece and 21.2% in the EU-27. However, in Greece it declined rapidly, only to start increasing again in recent years, reaching 13.9% of GDP in 2023. In the EU-27 they had a slight increase, also in recent years, reaching 22.2% of GDP in 2023.
Foreign direct investment inflows started at 1.8 billion euros in 2009, almost dropped to zero in 2010 (€200 million), and then followed a slow, intermittent upward trend (falling to €1.1 billion in 2015), which peaked in 2022 with €8 billion, while in 2023 they reached €5 billion.
As noted in the bulletin, “since the onset of the economic crisis, the role of exports in the economic activity of the Greek economy has been systematically strengthened, while, at the same time, in recent years, there has been a recovery in the contribution of fixed capital investments to GDP and a large increase in FDI inflows to the country. However, the Greek economy still lags behind the EU average in terms of the ratio of goods exports to GDP, indicating the existence of significant room for improvement in this sector.”
In addition, the country is still characterized by a significant investment deficit in proportion to the size of its economic activity, which underlines the importance of attracting productive FDI.