EU calls upward GDP revision ‘unprecedented’

The government’s clumsy attempt to boost the country’s GDP by including part of the widespread black economy has been met with skepticism by the European Union and already made the rounds of international news wires with the headline «prostitutes, smugglers give Greek economy a boost,» following the wording of a Reuters wire. In an interview with Reuters yesterday, National Statistics Service (NSS) chief Manolis Kontopyrakis said that «the revised GDP will include some money from illegal activities, such as money from cigarette and drinks smuggling, prostitution and money laundering.» He added that Greece’s 2001-2006 gross domestic product will get a 25 percent boost, this year’s budget deficit would drop 2.1 or 2.2 percent of GDP instead of a projected 2.6 percent and that total debt will be cut to «88-90 percent of GDP» this year instead of a projected 104.8 percent. Kontopyrakis said the adjustment was in accordance with Eurostat (the EU’s statistics agency) rules. Economy and Finance Minister Giorgos Alogoskoufis told Parliament yesterday that definitive figures will be published in the coming days, attributing the revision less crudely than Kontopyrakis to a more accurate measurement of the services sector. Alogoskoufis said the government was following Eurostat guidelines for the periodic (every five years) revision of the base year for national accounts. Amelia Torres, a spokeswoman for Economic and Monetary Affairs Commissioner Joaquin Almunia told reporters in Brussels that Greece’s revision of the GDP was «unprecedented… and needs to be checked… There have been no prior discussions between Greece and Eurostat on the subject.»