Έκθεση ΟΟΣΑ για την Ελλάδα

3.

DEVELOPMENTS IN INDIVIDUAL OECD AND SELECTED NON-MEMBER ECONOMIES

GREECE GDP growth is projected to rise to 2.3% in 2018, and then moderate to 2% in 2019.

Private consumption and investment will lead the recovery, responding to reduced policy uncertainty and gradually improving financial conditions. Exports should continue to increase, supported by rising external demand. Accelerating imports will subtract from growth in 2019. Excess capacity is diminishing but remains exceptionally large, limiting price and wage pressures.

The budget surplus is on track to exceed the 2017 target, through improved tax compliance and restrained expenditure. Further progress is needed in addressing tax arrears. Reducing high levels of poverty, especially among young people, remains urgent. The guaranteed minimum income programme is a welcome first step but social protection overall needs to be refocused. The recent spending review has identified fiscal space for a moderate expansion of targeted social programmes. Continued product market reforms would further improve competitiveness.

Greece’s high public debt and banks’ large stock of non-performing loans (NPLs) are sources of financial vulnerabilities. Putting public debt on a stable downward path will require sustained reforms to boost potential output and additional debt restructuring.

Banks’ large stock of NPLs adds to risks and limits banks’ lending. Gradually curing and disposing of NPLs while ensuring banks retain sufficient capital buffers is a priority.

A gradual recovery is emerging The completion of the second EU programme review in June 2017 buoyed confidence, supporting activity. Employment growth is buttressing incomes and private consumption, although many new positions are temporary or part-time and pay the minimum wage.

Greece’s improved competitiveness is boosting goods exports while the international recovery is supporting tourism revenue. Excess capacity remains significant and inflation and wage pressures weak.

Greece The primary budget balance is in surplus

Banks’ central bank funding is declining and NPLs have stabilised

% of GDP 80

% of GDP 16 Government primary balance Government revenues Government expenditure

% of total gross loans 49

Billion EUR 175

Central bank funding¹ Non-performing loans

70

150

8

60

125

35

4

50

100

28

0

40

75

21

-4

30

50

14

-8

20

25

7

10

0

12

-12

2008

2010

2012

2014

2016

2018

2011

2012

2013

2014

2015

2016

42

2017

0

1. Includes emergency liquidity assistance (ELA) provided by the Bank of Greece and financing provided by the European Central Bank.

Source: OECD Economic Outlook 102 database; Bank of Greece; and IMF. 1 2 http://dx.doi.org/10.1787/888933631608

OECD ECONOMIC OUTLOOK, VOLUME 2017 ISSUE 2 © OECD 2017 – PRELIMINARY VERSION

155

3.

DEVELOPMENTS IN INDIVIDUAL OECD AND SELECTED NON-MEMBER ECONOMIES

Greece: Demand, output and prices 2014

2015

Current prices EUR billion

GDP at market prices Private consumption Government consumption Gross fixed capital formation Final domestic demand Stockbuilding1,2

178.7 125.4 36.2 20.6 182.3 0.7 183.0 57.8 62.1 - 4.3

Total domestic demand Exports of goods and services Imports of goods and services Net exports1 Memorandum items GDP deflator Harmonised index of consumer prices Harmonised index of core inflation3 Unemployment rate (% of labour force) Household saving ratio, net (% of disposable income) General government financial balance4 (% of GDP) General government gross debt (% of GDP) General government debt, Maastricht definition (% of GDP) Current account balance5 (% of GDP)

_ _ _ _ _ _ _ _ _

2016

2017

2018

2019

Percentage changes, volume (2010 prices)

-0.3 -0.5 1.2 -0.3 -0.1 -1.0 -1.0 3.1 0.4 0.9

-0.2 0.0 -1.5 1.6 0.1 0.5 0.5 -1.8 0.3 -0.7

1.4 0.9 1.3 3.3 1.2 0.0 2.2 5.7 5.0 0.2

2.3 1.3 0.4 7.2 1.9 0.0 2.5 5.8 4.3 0.4

2.0 1.4 1.4 7.5 2.3 0.0 2.3 4.9 5.8 -0.3

-1.0 -1.0 0.1 1.8 0.5 -1.1 0.0 1.2 1.0 1.2 -0.4 0.6 0.5 1.0 1.2 24.9 23.5 21.7 20.5 19.5 -19.5 -22.1 -21.1 -20.8 -20.9 -5.7 0.5 -0.9 -0.1 0.4 183.3 189.5 186.6 181.5 178.0 176.8 180.8 177.9 172.8 169.3 -0.2 -1.1 0.4 0.4 0.1

1.

2.

3.

4.

Contributions to changes in real GDP, actual amount in the first column.

Including statiscal discrepancy.

Harmonised index of consumer prices excluding food, energy, alcohol and tobacco.

National Accounts basis. Data also include Eurosystem profits on Greek government bonds remitted back to Greece. For 2015-2019, data include the estimated government support to financial institutions and privatisation proceeds.

5. On settlement basis.

Source: OECD Economic Outlook 102 database.

1 2 http://dx.doi.org/10.1787/888933632615

Banks’ access to funding is improving. While deposits lost during the crisis are yet to return, banks’ access to interbank funding is rising, while their use of emergency financing from the central bank is decreasing. However, banks continue to reduce lending.

Non-performing loans (NPLs) rates remain high, at 36% of total loans in early 2017.

Rebuilding banking and fiscal resilience for an inclusive recovery The government is on track to achieve a primary budget surplus of 2.2% of GDP in 2017, above its target. Ongoing improvements in revenue collection and the end of temporary spending programmes support the budget and offset cuts in personal income tax rates and increased government consumption. Reduced uncertainty over public finances led to an upgrade in the government’s credit rating and to lower spreads on public debt, and allowed the government to issue its first bond in three years. Improved tax compliance and spending controls are expected to raise primary budget surpluses in 2018 and 2019.

Reforms are improving banks’ governance and reducing costs. A new NPL resolution framework is in place, and banks have met initial targets. Banks are well capitalised, but

156

OECD ECONOMIC OUTLOOK, VOLUME 2017 ISSUE 2 © OECD 2017 – PRELIMINARY VERSION

3.

DEVELOPMENTS IN INDIVIDUAL OECD AND SELECTED NON-MEMBER ECONOMIES

the quality of the capital is uncertain, as much is in the form of deferred tax assets. Capital controls remain in place, while a roadmap outlines their future relaxation.

The initial economic recovery has yet to reduce poverty. Existing social protection programmes continue to be dominated by pension spending, providing little support to the young. The social protection system can be better focused on protecting families, especially those with children and parents without work, from a steep rise in poverty. The guaranteed minimum income, rolled out nationally in 2017, is a step towards building a more equitable system, which will require more targeted programmes, such as school meals, and family and housing benefits.

Improving investment will boost the recovery GDP growth is projected to strengthen in 2018 and remain solid in 2019. Business and housing investment are projected to rebound, after 10 years of contraction, as financing conditions and confidence improve. The effect of recent product and labour market reforms will support competitiveness. Expanding employment and low inflation will buttress private consumption. The recovery in domestic spending will progressively accelerate imports relative to exports, with net exports contributing negatively to GDP growth in 2019.

High levels of public debt and NPLs make Greece’s economic outlook highly sensitive to any slippage in policy. Slower progress in addressing NPLs would lower confidence and investment and activity. Higher public debt service costs, especially after the EU programme concludes in August 2018, could adversely affect public finances and broader confidence, dragging down growth. Additional public debt restructuring would accelerate gains in access to finance and in activity. Stronger progress on the reform programme would raise productivity, investment and by more than projected.

OECD ECONOMIC OUTLOOK, VOLUME 2017 ISSUE 2 © OECD 2017 – PRELIMINARY VERSION

157