ECONOMY

Construction falls to five-year low

Construction activity fell 32.2 percent year-on-year in August, its biggest drop in five years, as the effects of austerity measures aimed at helping to improve the viability of state finances became more apparent, according to the Technical Chamber of Greece (TEE). Based on fees collected by architects and engineers from building studies and construction projects, revenues in August dropped further on top of a 14 percent decline in July and a 12 percent drop in June. «This is a tragic course [of events] which is being driven by the government measures – whether they are dictated by the troika and the memorandum or not – in the areas of taxation, liquidity and the breaking up of labor relations,» said Yiannis Alavanos, the president of TEE, which has about 87,400 members. «At the same time, there is a complete lack of any growth strategy in the areas of town planning, construction and infrastructure,» Alavanos said in a statement. The drop-off includes work commissioned by homeowners interested in legalizing illegally constructed parts of their property under a government plan aimed at boosting state revenues by 1.5 billion euros. A measure of Greek economic sentiment put together by the Foundation for Economic and Industrial Research last month showed that the outlook in the construction industry was among the bleakest in the economy due to the lack of projects in the pipeline. The construction sector contributes about 7 percent to total annual economic output and is one of the country’s key employers, providing some 400,000 jobs, according to data released at the end of last year.