ECONOMY

Growth slows down in Q1, but outstrips 2004 forecast

The Greek economy continued outperforming eurozone partners in the first quarter of 2004, when it grew at a rate of 4.1 percent year on year with the pace of investment accelerating, according to figures released by the National Statistics Service (ESYE) yesterday. The figure, nevertheless, represents a linear slowdown from the previous two quarters, the third and fourth of 2003, when the country’s gross domestic product (GDP) grew at rates of 5.3 percent and 5.0 percent respectively, closing the year at 4.7 percent. In relation to the last quarter of 2003, the rise was 3.0 percent. The Economy and Finance Ministry recently revised downward its previously forecast growth rate for 2004 from 4.2 percent to 3.7 percent. Spending on final consumption in the first quarter advanced 2.5 percent year on year -contributing 1.6 percent to the rise in total demand – and 0.4 percent in relation to the last quarter of 2003. Investment grew at a rate of 6.1 percent year on year and 8.2 percent in relation to the previous quarter, contributing 1.4 percent to the rise in total demand. As a result, the share of investment in total demand rose, ESYE said. Exports fell 5.6 percent year on year, causing a 0.8 percent slowdown in total demand. The fall was 10.0 percent in relation to the previous quarter. Imports also fell, by 0.7 percent year on year, meaning that domestic products had a higher relative contribution to final demand. The decline was 8.5 percent in relation to the fourth quarter of 2003. Tourism gloomy Tourism entrepreneurs yesterday forecast a 5-8 percent decline in the number of foreign arrivals and an even steeper fall in currency earnings this year, despite the Olympic Games. Speaking at their annual conference in Rhodes, members of the Panhellenic Federation of Tourism Enterprises (POET) said the main factors behind the projected decline are the lower competitiveness of the Greek tourism product, a failure to tap the Olympic Games as a major event, limited advertising and lack of coordination between the responsible public agencies. Deputy Tourism Minister Tassos Liaskos said the government is resolved to turn the sector into the spearhead of economic growth, and a draft bill now being prepared will deal with all aspects of a comprehensive new policy.