ECONOMY

Injection aims to limit recession

injection-aims-to-limit-recession

Aware of the very negative effects of the pandemic on tourism, Greece’s main industry, the government plans to inject a further 4.5 billion euros into the economy in the fall.

The injection will take the form of return of pre-paid taxes, but also a massive subsidy for seasonal employees.

Those who became unemployed as a result of the tourism industry’s downturn will be given priority. The government is treating the situation as an emergency, since many people who depended on summer employment for their year-round livelihood face a devastating decline in income.

One idea, put forward by the commission under economist Christopher Pissarides, is to convert unemployment benefits into retraining subsidies.

The government’s main priority is to limit, as far as possible, the extent of the recession, even at the expense of the budget deficit, the public debt and the state’s cash reserves.

On Tuesday, the independent Statistics Authority is expected to announce a record second-quarter economic contraction, estimated to be between 12 and 16 percent.