The Greek Economy Is Recovering And Exiting The Crisis
By Dimitris Papadimoulis
19 September 2017
The latest data from Eurostat shows that the Greek economy is steadily entering a growth phase, after many years of recession. Investments are increasing and exports are back on track with a surge of 18% – the highest rate since 2001.
Unemployment has fallen to 21.2% compared to 27% in 2014, and for two consecutive years the Greek government has succeeded in surpassing fiscal targets for primary budget surpluses, moving towards the adoption of small but significant relief measures for the most vulnerable social groups. According to the available data and various economic forecasts, the goal of a 2% growth rate can be achieved this year while prospects for a higher rate in 2018 seem to be realistic. In this respect, it goes without saying that something is changing in the Greek economy.
These fiscal and macroeconomic achievements are the outcome of the great effort of the Greek government to exit bailout programs in August 2018. It is a patriotic, collective responsibility for us to reinstate economic independence in Greece and turn the country into an equal member state of the eurozone. At the same time, we aim to tackle irregularities in the labour market and create conditions for sustainable development, seizing all possible investment opportunities that abide by the institutional framework and the laws of the country.
During these couple of years we have faced mounting problems and burdens, being restrained by a tough fiscal monitoring process and inheriting a massive public debt from the previous governments of New Democracy and PASOK. The Syriza-led government is making great efforts to deal with structural problems and endless corruption scandals, pushing for progressive reforms in the public sector, in health and education, while building the conditions for the economy to finance its needs by its own means.
The swift and successful conclusion of the third bailout review will be an additional push factor towards that end, giving time and space to the government to focus more on domestic issues.
In this context, one of the fundamental priorities of the Greek government is the creation of a production model that builds on the comparative advantages of the economy and supports productive forces, especially the social groups that have stood with us in Greece and Europe, throughout these years, and are gradually starting to feel the benefits of the fiscal progress in the real economy.
Furthermore, a great number of European leaders and citizens have acknowledged that the Greek government is not only managing a bankrupt state, but has been called to restructure the entire public system and rebuild some of the major pillars of a modern state, departing from constitutional reforms and going towards social justice, a fair social insurance system, a sustainable banking sector, effective local and regional transports – i.e. every possible field of public policy that has been ruined during the last decades.
For this reason, European Commission President Jean-Claude Juncker, Economy Commissioner Pierre Moscovici and head of ESM Klaus Regling but also leading politicians like Emmanuel Macron or Jeremy Corbyn are supporting the Greek government and admit that no other member state could tackle such a spate of reforms in such a short period of time.
In the coming period, and as we are approaching the end of the bailout program, it is certain that more hard work lies ahead of us. The challenge we are facing is monumental both for Greece and Europe: The policies that produced a devastating crisis and facilitated the rise of extreme right have to be successfully and convincingly addressed.