Greece: Navigating in Turbulent Waters
The news on the condition of the Greek economy present a continuing success story compared with the average EU member states, unless a more careful examination is undertaken.
Announcements of positive aspects of the economy are overemphasized while the troubling trends are either not widely reported or reported as insignificant. Government-friendly research organizations –think tanks, research departments of the major systemic banks—including government agencies praise the efficient and effective management of the economy. To be sure, statistical releases from the Bank of Greece (BoG) and the Hellenic Statistical Agency (Elstat) report some positive trends: growth of output, declining “official” unemployment rates, increases in the minimum monthly wage, PMI, public and private investment and fiscal discipline –accomplished by a combination of larger collection of tax revenues and limiting primary expenditures—delivering primary surpluses. The latter increases the country’s credibility in financial markets reflected in higher credit ratings for Greek government bonds and relatively lower interest rates than in past periods that reduces the cost of borrowing.