Work starts to boost GDP figures
The Economy and Finance Ministry is expected to inform the European Commission in May that it plans to revise upward the size of the country’s gross domestic product (GDP) in a procedure that will help to lower the budget deficit and public debt. In February, the European Commission started disciplinary steps against Greece – and five other European Union countries – for exceeding the bloc’s 3 percent limit for the budget deficit. Greece will have until the end of 2010 to abide by EU rules. Sources said the ministry has already begun putting the file together that it will present to Brussels in May, showing why the GDP figure needs to increase. Ministry officials estimate that the new figures will be applicable as of the second half of 2010. The size of the economy is an important indicator, as it determines the extent of the budget deficit and public debt. Greece’s last revision to its annual economic output took place in 2006 when the figure was revised 9.6 percent higher. Greece had asked for it to be pushed 25 percent higher. It is unclear what size increase the ministry will try to secure this time around. Regardless of the actual outcome, it is believed that the move will have a positive impact on the country’s economic indicators – from the accounting point of view. A number of problems were created by the procedure in 2006, due to the Commission doubting the data put forth by the Greek Economy and Finance Ministry. This time around, Greek officials will work much better with Eurostat, according to a source. Greece’s National Statistics Service will prepare new studies and record the extent of the black economy, illegal activities and unrecorded employment, among other things, the source added. The revision to annual accounts is a procedure countries complete every five years in order for economic figures to better reflect the economy.