ECONOMY

Stournaras reiterates call for new policy mix

stournaras-reiterates-call-for-new-policy-mix

Addressing the International Atlantic Economic Conference in Athens on Thursday, Bank of Greece Governor Yannis Stournaras set 10 conditions for the Greek economy to achieve higher growth rates in the future.

The central banker said robust growth requires the reduction of the primary surplus target from 3.5 percent of gross domestic product to 2 percent as of 2022, the reduction of bad loans through the two securitization plans proposed, a change in the fiscal policy mix with lower tax rates and more public investments, the implementation of more structural reforms to safeguard the fiscal targets, and the expansion of cooperation between the public and private sectors.

Stournaras further cited as necessary conditions the improvement of the quality and preservation of the independence of institutions in Greece, the attraction of foreign investments by cutting taxes, red tape etc, the supply of incentives to boost small and medium-sized enterprises, and sustained flexibility in the labor market along with support for the long-term unemployed.

The former finance minister also called for the strengthening of the so-called “triangle of knowledge” – education, research and innovation – and the digitization of the economy.