EU cash to benefit Greece most
One year after the original agreement (i.e. by the end of the current quarter) the Next Generation EU fund will receive its full ratification, which is set to be the big catalyst for the economic recovery in Greece, as it will be the country that benefits the most from the European resources in terms of their growth impact, according to a Societe Generale report released on Wednesday.
According to the French bank’s analysts, the fiscal multiplier in Greece will be close to 1 (i.e. almost 100% gains) against a eurozone mean rate around 0.7.
In gross domestic product percentage terms, Greece stands to reap the greatest benefit among the eurozone member-states, as the resources will amount to 10.5% of the country’s GDP in European grants. Many other countries in Central and Eastern Europe stand to benefit particularly in relation to their GDP, while Italy and Spain will receive the highest amounts in absolute figures (83 billion and 76 billion euros respectively).
Greece will also enjoy the benefits of making a head start, as it will be one of the first countries to have its first installment disbursed thanks to the early submission of its action plan.