ECONOMY

Faster action could ease the pain

Two leading business groups put pressure on the government yesterday to pick up the pace of introducing incentives aimed at supporting investment activity, arguing that any delays will deal a heavy blow to the labor market. Giorgos Kasimatis, the president of the Central Union of Chambers of Greece (KEEE), said that more than 100,000 businesses across Greece are heading for closure as consumption plunges in the deepening recession. This could result in some 150,000 people losing their jobs in the trade sector, said Kasimatis, who is also president of the Piraeus Chamber of Commerce. With gross domestic product likely to contract by 4 percent this year, after shrinking by 2 percent last year, Kasimatis’s comments are the latest call for help from the business community. Figures released earlier this week by the National Confederation of Greek Commerce (ESEE), showed that 25 percent of retailers have shut down in some central Athens shopping districts as traders have seen revenues drop during the summer sales season by up to 12 percent from 2009. The government has acted swiftly in slashing spending and upping taxes in order to cut its massive deficit, earning praise from the European Central Bank, the International Monetary Fund and European Commission. However, business leaders have accused the Socialist government of foot-dragging when it comes to easing the pain from the downturn. Constantinos Michalos, president of the Athens Chamber of Commerce and Industry (EBEA), said yesterday the government does not have a moment to lose after taking a year to put business initiatives on the talks table. The Economy Ministry has put up for discussion a draft bill, labeled as the Development Law, which targets a boost in investment activity through the use of subsidies and tax breaks. The Development Law will pump between 4.3 to 5.7 billion euros into businesses from 2011 to 2013, with the help of EU funds.