Greek economy to recoup 2020 losses by end of 2022

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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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