Greece can achieve a primary of growth rate of 3.5 percent of GDP (Gross Domestic Product) this year, said the influential Hellenic Fiscal Council in its autumn report on Tuesday.
The thinktank organisation that is a member of the EU Independent Fiscal Institutions Network, said the growth target was feasible because the Greek economy was showing positive signs of growth in economic activity combined with the setting up of prudent fiscal policies.
“This positive dynamism of the economy, however, should be intensified in the coming years. Latest signs are encouraging: Greek banks’ deposits rose more than 10 billion euros in the last few months, consumer confidence is at several-year highs, 10-year Greek state bond are at historic lows while three-month Treasury bills offer negative returns,” said Panagiotis Korliras, the president of the Council.
“Policies combined with economic stability could lead the economy to a course of solid and sustainable growth on the precondition that the economy is able to absorb any turbulence from the external environment,” he said.
Mr Korliras said that a two per cent growth of the country’s real GDP, as predicted by the Greek finance ministry, was feasible even if it was more optimistic that the council’s own forecast for the year.
The council report noted that the ministry’s 2.8 per cent growth rate prediction for 2020 was also “optmistic but within accepted limits.”
Meanwhile, the European Bank for Reconstruction and Development (EBRD) said in its own eport also released on Tuesday that Greece’s economy would grow by two percent this year and 2.4 per cent in the coming year.
The EBRD said in its autumn economic forecast report that the country’s recovery which began in 2017 had continued into the first half of this year. The key drivers for growth had been the export of goods and services, the EBRD reported. Private consumption continued to have a positive impact on growth and unemployment, which was down to 17 per cent in August, continues to decline.
The EBRD said the improved conditions boosted market and investor confidence in Greece. It said investment was the key to full economic recovery and would rise as the health and financial sectors improved.
In Athens, the governor of the Bank of Greece, Yannis Stournaras expressed optimism about Greece’s continued economic recovery, predicting a robust growth rate of up to 2.5 per cent next year.
Speaking on Tuesday, Mr Stournaras predicted that growth would reach 1.9 per cent this year before climbing up to 2.3 or even 2.5 per cent in 2020. He added that the conservative government has adopted business-friendly policies, putting emphasis on reforms and privatisations while making it a priority to draw foreign investment.