ECONOMY

New budget burden of €2.6 bln

new-budget-burden-of-e2-6-bln

The European Commission expects an extra burden on the state budget from the stricter lockdowns in Greece amounting to 2.6 billion euros or 1.5% of gross domestic product.

In its ninth Enhanced Surveillance Report, released on Wednesday, Brussels estimates that the support measures will total €11.2 billion, or 6.5% of GDP. This compares with the budget’s provisions for €7.5 billion plus €1.1 billion from the React EU fund, i.e. a total of €8.6 billion. However, the closing of retail commerce in January and February and the prospect of another couple of weeks in March could see the cost swell.

Last year the funds dedicated to the support of the economy amounted to €15.3 billion, or 9.4% of GDP. In general the cost of support is proportionately slightly higher than that in other EU states, the report noted.

Far from being surprised, the Finance Ministry agrees with the estimates from Brussels and is preparing for more revisions in the future. The ministry’s favorable scenario provides for a second-quarter rebound with a robust tourism season this summer, but the Commission stresses the general uncertainty.