Greek economy to recoup 2020 losses by end of 2022


Greece’s economy is expected to recoup all losses suffered in 2020 in the fourth quarter of 2022, with the country’s real GDP surpassing the 2019 level by 1.7% by the end of 2022, according to a draft budget plan tabled in parliament on Monday.

Specifically, Greek GDP is expected to grow by 6.1% this year and 4.5% in 2022, after contracting by 8.2% in 2020. Private consumption is expected to grow by 2.9% this year, after falling 5.2% in 2020 and growing 2.9% in 2022.

Public consumption is expected to increase by 4.1% this year and decrease by 2.8% in 2022, after rising by 2.7% in 2020, the government will gradually lift support measures.

Private investment, which fell 0.6% last year, is expected to jump 11.1% this year and soar 23.4% in 2022, helped by the influx of funds from the Recovery Fund.

Exports of goods and services fell 21.7% in 2020, but are expected to rise 14% this year and 11.1% in 2022.

Greek imports are expected to rise 6.6% this year and 8.9% in 2022, after falling 6.8% in 2020.

Unemployment is expected to fall to 16% this year and 14.3% of the labor force in 2022, from 16.3% in 2020.

The draft budget plan noted that the National Recovery and Resilience Plan is expected to add 2.9 percentage points to GDP in 2022 disregarding leverage, while a gradual return to normal, based on the vaccination program, will provide additional economic benefits.

A return to normal should help stabilize fiscal data and support a further recovery in the tourism sector, with travel receipts expected to rise 60% from 2021.

The draft budget also provides that the implementation of certain development measures, of a permanent nature, aimed at improving the investment environment and increasing household incomes, should support economic recovery.

Greek real GDP is expected to grow by 4.5% in 2022 compared to 2021 based on private consumption (2.9%), investments (23.4%), exports of services (21%), employment (2.7%), while the inflation rate is projected at 0.8% in 2022.

The draft budget plan notes that Greek GDP is expected to grow by 6.1% in 2021, recouping 68.1% of the losses incurred in 2020.

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