BUSINESS

GDP boost via new method of calculation

By Leonidas Stergiou

The new methodology Eurostat is to adopt from October will see Greek gross domestic product boosted by 3 percentage points for this year, while reducing the ratio of debt to GDP by 4.4 percent.

The European System of Accounts (ESA 2010) will replace the existing ESA 95. The next deadline for the submission of data by the Hellenic Statistical Authority will be in September and it will use this new system. Where the new system is different is that it takes into account defense expenditure, investment in research and development, and the export of goods for further processing. Greece will benefit as it has a large defense bill.

The new method, for example, would have seen recession in 2013 shrink from 4 percent to just 0.3 percent, including the impact of the deflation, and turn the small GDP increase of 0.6 percent projected for this year to a robust 3.6 percent expansion.

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