Brussels sees Greek growth at 7.1% this year

Commission report expects economy to fare far better than 4.3% increase forecast in summer

Brussels sees Greek growth at 7.1% this year

The European Commission has considerably raised its forecast for Greek growth this year, but it has also eased its projection for 2022.

In its fall forecasts Brussels said the Greek economy will post a 7.1% expansion in 2021, compared to its July estimate for 4.3% and the government’s latest projection for 6.1%.

For 2022, the Commission expects Greece to show a 5.2% growth rate (down from 6% previously), while in 2023 it is seen coming to 3.6%.

Commenting on the upgraded projection, Economy Commissioner Paolo Gentiloni spoke of a “strong recovery” that will continue in 2022, and made special reference to the “very positive prospects” for private consumption and investments, as well as the “very good” performance of tourism.

A Commission official explained further that the second-quarter growth data “point to the strengthening of the recovery,” and that the Commission expects the third and the fourth quarters to stick to that trend. Regarding next year, the same source said that the Recovery and Resilience Facility, known as the Greece 2.0 program, “will contribute considerably to growth.” The total forecast for growth in 2021 and 2022 is above the summer estimates, he noted.

On the role of the Greece 2.0 program, the Commission report noted that “growth in 2022 and 2023 is expected to rely on public and private investments, as the implementation of projects included in the Recovery and Resilience Facility is expected to maintain the momentum. The forecast incorporates the condition that the expenditure the RRF will finance will reach up to 3.6% of gross domestic product of 2019 in that period.”

Finance Minister Christos Staikouras said the fall forecasts “confirm the correctness and efficiency of the economic policy exercised in our country.” The Greek economy, the minister noted, “is rebounding strongly and growing in sustainable fashion, investment and exports are expanding significantly, unemployment is shrinking, the cash reserves remain at safe levels and fiscal management is responsible.”

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