The cycle of horizontal support measures for enterprises and workers is ending, after over 40 billion euros has been channeled into the economy from the state budget and European funds.
After the economy started reopening in April, the Finance Ministry is now bringing an end to commercial rental exemptions, contract suspensions, cheap state loans and the deferral of tax and social security obligations; instead it is turning to measures that only target sectors where restrictions will continue.
The cash spent and the resources to flow in from the Next Generation EU fund amount to 32.1% of the country’s gross domestic product, according to a report by Dutch bank ING, making Greece the world leader, even beating the US financial package (at 25.5% of its GDP).
Now that period is over, says a senior ministry official, unless the return to normalcy requires new funds to avert soaring unemployment and corporate shutdowns. “We must proceed to the post-pandemic period all together,” the same official stressed.
The ministry has now started drafting its plans for the rest of the year, hoping that it won’t face the same situation as it did in the first few months of 2021, when its plans had to be redrawn time and again due to the course of the pandemic. These plans provide for targeted measures amounting to €2.5 billion in June and include the following:
– Rental exemptions will exclusively apply to businesses where restrictions remain, such as gyms, children’s playgrounds, dance schools and possibly food service, which remains partly closed. After May the government is considering reinstating an optional reduction of at least 30% following an agreement between the landlord and the tenant.
– Next month the program for subsidizing companies’ fixed expenditure will begin, with some 30,000 enterprises set to receive credit vouchers adding up to €500 million euros, provided that the credit will only be used to offset tax and social security obligations.
– The special-purpose compensation will only go to seasonal tourism workers.