ECONOMY

SEV warns on competitiveness of the Greek economy

sev-warns-on-competitiveness-of-the-greek-economy

The Greek economy may have been on a positive course for the last couple of years, but its investment competitiveness is backtracking, according to the monthly bulletin published by the Hellenic Federation of Enterprises (SEV). Its economists stress that this weakening of competitiveness is damaging the country’s chances of achieving a robust rise in gross domestic product and bringing the unemployment rate down to an acceptable level.

The bulletin further notes that the deterioration of Greece’s international competitiveness is continuing and sooner or later will be aggravated further by various election handouts and measures that will undermine fiscal discipline.

According to SEV, the recovery of the Greek economy is taking longer than expected, and without any clear indications of an acceleration in investment and economic activity. This is reflected in the stagnation of productivity against the backdrop of a global economic slowdown.

The SEV economists add that the national target should be the country’s rapid convergence with the investment competitiveness of other European Union member-states. For that to happen, SEV points out that the state needs to continue implementing the agreed reforms, speed up the implementation of privatizations and state asset utilizations, expand the production base, support innovation, put an end to overtaxation, reduce non-salary costs and introduce a competitive framework of energy costs.

The industrialists’ bulletin additionally calls on the government to guard against fiscal hazards stemming from an extended election period.

The SEV report does acknowledge the recent progress recorded, with the Eurogroup decision on April 5 for the disbursement of almost 1 billion euros to Athens thanks to the implementation of reforms concerning the new primary residence protection framework and the 2019 state budget, which have brought the second post-bailout assessment by the European Commission to a successful conclusion.