ECONOMY

Greek growth in Q3 tops other eurozone countries

The Greek economic engine might be slowing down but it still managed to outpace all other eurozone member states by a significant margin in the third quarter of the year, data on national output released by Eurostat, the EU’s official statistical service, yesterday showed. While the eurozone economy grew by an anemic 0.3 percent in the July to September period on a yearly basis, the Greek economy galloped ahead at 3.4 percent. It was also the strongest gainer among the eurozone countries, even overtaking the US economy which grew by 3.2 percent. GDP growth rose by 1.1 percent month-on-month in the third quarter against 0.3 percent for the eurozone. The 3.4 percent growth, however, marked a slowing pace of expansion compared to the 4 percent improvement in the second quarter and a 4.3 percent increase in the first quarter. The deceleration is to extend to the final quarter, said Platon Monokroussos, economist at Eurobank, who sees growth at 3.5 percent. In comparison, the European Commission said yesterday the eurozone is expected to expand between minus 0.2 percent and 0.2 percent in the final three months of the year and the contraction could continue into the first quarter of 2003. Overall, Greece could come close to achieving its target of 3.8 percent growth this year. «GDP growth for the full year is expected in the range of 3.5 percent to 3.8 percent,» Monokroussos said. «My estimate is for 3.6 percent.» The Bank of Greece in its interim monetary policy report last week said the economy would expand by 3.5 percent, while the government has stuck to its 3.8 percent forecast. Greece’s strong economic pace is set to continue to 2003, fueled by strong public investment activity, robust consumption spending, the inflow of community funds and infrastructure works related to the 2004 Olympic Games. Another driving force, the consumer credit boom, should be stimulated further by lower borrowing costs next year should the European Central Bank trim interest rates tomorrow, as expected. Greece’s stability and growth program for 2002-2006 forecasts average growth of 3.8 percent in the next four years, more than twice the projected eurozone estimate.