Greece’s economy will contract by 8% this year, the OECD forecast on Wednesday, saying the impact of the coronavirus crisis was a setback to Greece’s longer-term economic recovery.
The OECD’s forecast assumes there will not be a second wave of Covid-19, it said. Should that occur, the decline in output this year could be 9.8%, it added.
The economy is expected to grow 4.5% in 2021, the OECD said.
Greece managed to keep a lid on the coronavirus pandemic by imposing an early lockdown, easing any potential strain on its healthcare system vulnerable from cutbacks during the country’s decade-long debt crisis.
Losses in output, unemployment and the budgetary costs of the pandemic would be less pronounced than during the country’s debt crisis from 2009 to 2016, but the OECD said a downturn in tourism, public finances and investment was a setback to its longer term economic recovery.