The estimates published by atradius they talk about one contraction of Greek GDP by 6% during 2012, leading to an overall contraction of –19% since 2008. Domestic demand was extremely weak last year (-8%), as well as investments (-18,6%) and public spending (-5,4%); this led to the collapse of the general price level, with inflation expected to be -0,3% this year. The only positive contribution to GDP comes from net exports, mainly thanks to the massive drop in imports (-18,7%). The data updated in December speak of unemployment rising to almost 27% of the population of working age, while for young people aged between 15 and 24 the situation has become extremely critical (61,7%). In this scenario, forecasts speak of two further years of recession for 2013 and 2014 (respectively, -5% and -1,5%), with a recovery that could only start from 2015.
Efforts to consolidate the Greek budget deficit have produced the desired results: from –15,6% of GDP in 2009 to –6,8% in 2012, while the aid and reform plan signed with the Troika (EU, ECB, IMF) will bring public debt down to the threshold of 124% of GDP by 2020. However, the road towards the pursuit of this result is exposed to various risks, first of all the failure to meet expectations that speak of an average GDP growth of 3% from 2015.
If you take a look at the progress of the necessary structural reforms, it can be seen how Greece is far from the EU average as regards the liberalization of products, services and professions, while the privatization programme, which has stalled, has only recently begun to show the first proposals for the sale of assets, thus further aggravating the need to attract productive investment from abroad. The same tax reform and the fight against tax evasion show still inefficient results, while political and popular resistance to structural reforms grows over time, increasingly limiting the room for manoeuvre. Emphasizing once again as is essential the factor of timeliness in implementing the necessary structural reforms capable of triggering virtuous mechanisms in the economic and social environment. And so Greece will have to work even harder to respect the limits imposed by the Troika, a fundamental element for obtaining the release of further tranches of aid that would give the economy some breathing space and hope for a recovery in the country.
