Greek economy to get multi-billion-euro lifeline

Greek economy to get multi-billion-euro lifeline

Prime Minister Kyriakos Mitsotakis will announce steps to revive the economy in a televised address on Wednesday. These steps will be mainly focused on tourism but will also concern other sectors affected by the coronavirus pandemic. 

The measures, both long-term and seasonal for the summer months, will be based on two pillars: fiscal interventions of 7 billion euros and liquidity of 10 billion euros. 

In his address Mitsotakis is expected to lay out the general framework of the roadmap to restart the economy this year and trigger a dynamic recovery in 2021, before handing over to the four ministers that will implement the plan to elaborate on the specifics – namely Finance Minister Christos Staikouras, Development Minister Adonis Georgiadis, Labor Minister Yiannis Vroutsis and Tourism Minister Haris Theocharis.

According to sources, the government will reduce VAT for bars, cafes and restaurants to 13 percent, while VAT reductions will also be approved for hotel accommodation charges. Moreover, worker salaries, in the tourism, catering and industrial sectors, will also be subsidized through the European Union’s SURE program, from which Greece expects to receive a total amount exceeding 1.4 billion euros. 

Initially, however, as the finance minister has already stated, money to subsidize work will be drawn from national resources until the SURE program is activated.

What is certain, however, is the government’s intention to ensure that the state will help those who work seasonally in the tourism sector by subsidizing their salaries and helping with their insurance contributions.

At the same time, the prospect of helping out real estate owners who received only 60 percent of the rent on their properties due to the government lockdown is also being examined. The government is looking at reducing their ENFIA property tax.

Announcements are also expected on Wednesday from the tourism minister regarding specific dates for reopening the borders to road tourism from Balkan countries, which could happen earlier than initially expected.

According to the plan, the government will seek to increase road tourism with its northern neighbors and especially with countries such as Bulgaria, which, like Greece, also have low rates of confirmed cases of the coronavirus. 

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