Greece expects 4.5% economy growth next year – Draft Budget 2022
ATHENS, Oct. 4 (Reuters) – Greece’s economy is expected to grow 4.5% next year after a strong rebound this year on stronger tourism, pent-up demand and a boost in support measures from the State, according to the government’s 2022 budget proposal scheduled for Monday.
The government recently revised upwards the economic growth rate projected this year to 6.1% from 5.9%.
“The economy has already recovered more than two-thirds of the gross domestic product lost in a year, although economic activity was still faced with restrictive measures in the first half of the year,” said Finance Minister Christos Staikouras.
Fitch Ratings said on Friday that Greece’s stronger than expected economic performance in the first half of the year led it to revise its GDP growth forecast for the year 2021 up to 6.0%.
Greece’s economy rebounded in the second quarter after an 8.2% pandemic-induced collapse last year, growing at a better-than-expected annual rate of 16.2% as consumer spending and investment picked up.
“It looks like the pre-pandemic GDP recovery will come sooner than expected, in the first half of 2022,” said Nikos Magginas, chief economist at the National Bank.
On the fiscal front, next year’s draft budget forecasts that the primary fiscal balance, which excludes debt service spending, will show a deficit of 0.9 percent of economic output, compared to an expected gap. 7.7% of GDP this year.
Greece’s public debt is expected to fall to 190.4% of GDP in 2022, from 197.9% this year.
Unemployment is expected to fall to 14.3% next year from 16.0% this year, according to the draft budget.
Reporting by Lefteris Papadimas and George Georgiopoulos; Editing by Emelia Sithole-Matarise
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