One of the ways the previous government used to inflate its budget surplus, and thus try to convince the country’s creditors that spending was finally being brought under control, was by underfunding public investment projects included in the budget.
In doing so, they were basically starving the economy of much-needed resources to boost growth.
As a consequence of this policy, the country failed to take advantage of plentiful money provided by the European Union for productive projects, especially as regards waste management and support for new businesses.
According to official data, Greece has absorbed 4.9 billion euros of the 19.7 billion earmarked by the EU for the 2014-20 period, or less than 25 percent.
At least the EU’s N+3 rule – which means that each country has until three years after the official end of the funding program to absorb the funds earmarked for it – means that there is still time to make up for the poor performance.
However, there is a real problem in waste management, since the failure to absorb funds not only affects the environment, locals’ and visitors’ health and the country’s image, but also burdens the budget with millions in fines to be paid for the current practice of dumping waste in landfills.
In the end, Greece might have to implement waste management projects with its own money, with no EU aid whatsoever.
European Commissioner for European Neighbourhood Policy and Enlargement Negotiations Johannes Hahn warned recently in a letter of the danger of missing out on funding, and also noted the delays in the funding of businesses and the financing instruments for the projects co-funded by the EU.
Deputy Development and Investment Minister Ioannis Tsakiris points out the need to accelerate the investment programs. “We need to spend 5 billion euros annually until 2023,” he says.
A total of nearly 1.1 billion is available for the taking to implement waste management projects and over 1.8 billion for business venture support.