Primary deficit down to zero

Primary deficit down to zero

The government said on Tuesday it has managed to bring last year’s primary budget deficit down to zero and announced an 8% increase in disability allowances.

Addressing a special event on the national economy, Prime Minister Kyriakos Mitsotakis said the increase in allowances decided “is a last symbolic but also essential move of the current parliamentary term.”

“It is important for every citizen to feel that the improvement of economic indicators also results in their own better life,” he pointed out, noting that after the increase in disability pensions, the relevant allowances had to follow, concerning 188,000 Greek citizens.

Mitsotakis emphasized that Greece is one step before investment grade, which will be reached within 2023 if a strong government emerges from the elections. The president of the Eurogroup, Pascal Donohue, who participated in the event, also agreed with the forecast for recovery of investment grade within the year.

Describing the evolution of economic indicators over the past four years, the prime minister noted that losses in average income have been covered, investment, exports and productivity have soared, the national product is returning to 2010 levels and Greece has the second strongest growth in the eurozone. Also, unemployment fell by 7 percentage points and 300,000 jobs were created. “All this happened while the country was dealing with the global pandemic, the hybrid attack on its borders, the ongoing energy turmoil and the aggressive behavior of its neighbors,” he noted.

He added that inflation is falling and today it is below the European average, more than 50 taxes and levies have been reduced, without threatening fiscal discipline, while the 2022 fiscal deficit was much lower than expected.

For his part, Finance Minister Christos Staikouras emphasized that ultimately the primary deficit of 2022 is zero, against a forecast of 1.6% of GDP. He pointed out that this result was achieved despite the generous fiscal support to citizens and enterprises in the face of the energy crisis, thanks to the country’s almost double growth compared to the eurozone average in the previous year. He added that the economy’s momentum guarantees the achievement of a primary surplus in 2023.

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