A drastic restructuring of Greek enterprises would enhance the country’s gross domestic product by 1.5 percentage points annually. This would amount to some 2.6 billion euros, which would be contributed through a streamlining process to the economy, with multiplying benefits, Piraeus Bank senior general director Giorgos Georgakopoulos argued while speaking at the 23rd Banking Forum.
The Piraeus official presented a study at the event organized by the Hellenic Management Association (EEDE) that for the first time reflects the cost to the economy and society of keeping alive some enterprises that are not sustainable.
According to the study drafted by Piraeus Bank chief economist Ilias Lekkos in cooperation with economist Paraskevi Vlachou, over 16.5 percent of the country’s production capacity is trapped in unsustainable entities at a cost to them, their creditors and society in general.
It goes on to examine the potential benefits that would result from the restructuring and streamlining of a third of the unsustainable enterprises, factoring in their obligations that add up to 23.5 billion euros, while their assets total 28.4 billion. If they were absorbed by healthy enterprises, their operating profits would grow by 2.6 billion euros and their revenues by 16.7 billion per annum.