ECONOMY

Greece makes competitiveness leap

greece-makes-competitiveness-leap

Last summer’s change of government played a decisive role in improving Greece’s ranking on the global competitiveness chart by nine positions compared with 2019, according to the Swiss-based Institute for Management Development (IMD).

The strengthening of competitiveness is mainly attributed to government efficiency, flexibility in government policy, transparency and the absence of the risk of political instability.

On these merits, Greece has risen to 49th place among 63 economies, against 58th last year, making the greatest progress after Cyprus, which jumped 11 spots.

Nevertheless, the IMD data, published by the Federation of Industries of Greece (SBE), put Greece quite low on the chart compared with eurozone peers like Germany (17th), Cyprus (30th), France (32nd), Spain (36th), Portugal (37th) and Italy (44th). Greece even trails Turkey (46th), Hungary (47th) and Bulgaria (48th).

The obstacles to the further advancement of Greece on the competitiveness chart are its demographic problem, the decline in the value of its exports last year and the shortage of skilled human resources due to the brain drain during the previous financial crisis.

Despite these challenges, Greece shows an improvement in several parameters that concern domestic enterprises and the economy in general. Business efficiency, for example, has taken the country up seven notches in this category, from 58th to 51st place, and in economic effectiveness Greece has risen from 60th to 55th place. Putting an end to the decline of the previous five years, Greece also improved in the infrastructures category, rising to 39th place from 41st last year.

The Greek economy is seen facing five major challenges, which if addressed would strengthen its competitiveness considerably. They relate to the broadening of its production base through investment in the industrial sector, the creation of a more favorable tax framework and the introduction of special programs to strengthen dynamic and export-oriented sectors.

At the same time, Greece needs to plan and implement digital technology initiatives, as well as to facilitate access of private corporations to funding.