Economy’s prospects get dimmer
The latest data on Greece’s current account deficit raise questions about the actual extent of the crisis afflicting the economy. According to data published by the Bank of Greece, the current account deficit in the first four months of the year is 50 percent higher than during the same period last year and Greek exports (at 4.25 billion euros) are less than a third of imports (13.3 billion). Moreover, direct investment shrank to 55 million euros, from 485 million last year. The numbers are worrying. Greek products have trouble gaining market share even in the domestic market. This means job losses. On the bright side, being in the eurozone allows us to borrow at low risk. However, our Treasury bonds, which should be popular as they offer slightly higher yields than their European counterparts, are becoming less so. The influx of foreign capital toward the acquisition of such bonds was limited to 5.7 billion euros in January-April 2005 from 8.7 billion in January-April 2004. On the other hand, interest payments on the country’s debt rose to 2.14 billion euros from 1.88 billion last year. Unionists have nothing to say about the country’s loss of competitiveness. As for the political parties: The Left keeps waiting for the revolution; the main opposition Socialists, although more careful, seem to be following the unsuccessful, populist model espoused by the currently governing New Democracy party while in opposition; and the government itself has been too timid and lacking in will for most of its 15 months in power. Even its small reformist steps are uneven and compromise appears to be their fate.