ECONOMY

Business is still fragmentary

Gov’t will present new bill with incentives for small enterprises to merge and expand

business-is-still-fragmentary

Enterprises in Greece continue to be very small in size, and focused mainly on commerce and services, which by definition makes them more vulnerable to extraordinary events and hampers their growth. A new bill will now try to convince companies to merge and grow.

The data the Hellenic Statistical Authority (ELSTAT) released on Thursday show that almost 95% of businesses in Greece, or 678,206 out of a total of 718,624 (based on 2019 figures), employ no more than nine people.

The country only boasts 550 companies with more than 250 staff each, but they account for 32% of total business turnover in Greece. About a quarter of them (142) belong to the manufacturing sector, which during the lockdowns displayed considerable resilience, and record strong performance.

The above data confirm once again the need for a shift in the economy’s production model – a shift that did not materialize even during the debt crisis of the 2010s – so that it relies less on vulnerable sectors and more on those of manufacturing and technology, while also having larger enterprises. This latter target is served by the incentives provided by the Greece 2.0 plan for mergers and acquisitions.

Kathimerini understands that in the next few weeks the government will present a new draft law that will offer incentives especially for small and medium-sized enterprises to merge, form alliances or expand.

According to ELSTAT the economic sector with the highest number of enterprises is wholesale and retail commerce with 227,183 businesses, which account for 31.6% of all companies in the country. That is followed by professional, scientific and technical services, with 137,925 corporations, or 19.2%, and accommodation and food service companies, numbering 109,215, or 15.2%. Manufacturing is only a meager 7.9% of all companies, with just 57,117 businesses.

Commerce, in particular, commands a particularly high share of the economy, as it accounts for 44.8% of total turnover and 26.2% of gross added value.