Despite growth in tourism, unemployment keeps rising

A day after reports by the IMF suggesting the need for new measures and by Parliament’s budget office on the unsustainability of the debt, more bad news on the course of Greek economy emerged on Thursday, as unemployment continued to grow, exports shrank and industrial output continued its decline.

Hellenic Statistical Authority (ELSTAT) data showed that seasonally adjusted unemployment climbed to 27.6 percent in July, up from 27.5 percent in June, while in the 15-to-24 age group the jobless rate came to 55.1 percent. The rise, meanwhile, came at the height of the tourism season which had been particularly good for Greece this year.

August witnessed a 7.2 percent decline in industrial output compared to the same month in 2012, when the index had shown a 2.1 yearly increase from 2011. ELSTAT data also revealed a 5.7 percent decrease in exports in August compared with a year earlier, amounting to 2.08 billion euros, down from 2.21 billion in August 2012. Imports also fell by 5.1 percent year-on-year to 3.91 billion euros.

There is some good news, however, as the budget continued to produce a primary surplus in September, according to figures for the first nine months of the year presented by Alternate Finance Minister Christos Staikouras on Thursday. These showed a surplus of 1.1 billion euros plus the 1.5 billion euros in Greek bond profits that eurozone central banks have returned to Athens. The shortfall in revenues has also decreased to 432 million euros in end-September from 728 million in August and 1.1 billion euros in July.

Maintaining the primary surplus at satisfactory levels for a third consecutive month constitutes the main reason why Greece’s creditors have agreed to include the forecast for a 344-million-euro primary surplus for the whole of 2013 in the draft budget for 2014.

Of course the final shape of next year’s budget will be determined by negotiations between creditors and the Finance Ministry starting on October 18, a senior ministry official said.

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