A different September

September is usually a weighty month for the economy. By this time, governments have shaped the following year’s budget and the prime minister outlines economic policy at the traditional keynote speech at the Thessaloniki International Fair; firms prepare for the last crucial quarter of the year. But this September will be different; because of the Olympic Games, it will be the effective beginning of the new government’s term, which has to produce new legislation on tax reform, investment incentives and concession agreements for public projects. It should also announce its plan on further privatizations and lay out the basis for managing the fiscal situation, which is not at all easy and hinders the implementation of many promises. Clearly, longer-term solutions will depend on the state of the economy after the Games, and their impact on key sectors such as tourism. Over and above the uncertainty caused by the Games and other concerns which must be addressed, the government must give a substantive answer to this crucial question: How to boost growth. Certain favorable conditions seem to be in place, notably a desire on the part of the government to safeguard peace on the labor front and the still high degree of public confidence it enjoys. It must now formulate the right policy mix to give substance to growth prospects; privatizations and market deregulation, in particular, will create the resources to fund growth in coming years. One of the crucial issues bound to emerge more forcefully is that a large part of the economy hinges on public sector organizations which, due to inadequate legal provisions, resort to options that effectively undermine ministerial decisions. The balance between successful and inadequate managers in the public sector will largely account for the final picture.