“Smiles” for high growth rate – What it means for support measures

By Chrysostomos Tsoufis

She spread smiles in the government’s financial staff ELSTAT announcement on the growth rate of the country in the first 3 months of the year which reached 7%. Scatter smiles because it is almost 2 points higher than the Eurozone average and why it is one of the highest among the 27 Member States.

He spread smiles because he was higher than expected as the first 3 months was a very difficult period as it includes a month of hostilities in Ukraine that raised prices in gas and oil. It is no coincidence that record prices for both of these goods were set in March.

He spread smiles because of them quality elements of the communication. Investments and exports recorded a significant increase despite the difficult conditions of 12.7% and 9.6% respectively, data that show clear dynamics of the economy. Here of course there is the asterisk of consumption. The Greeks – coming out of quarantine – consumed like crazy as shown by the growth rate of consumption at 10.5%.

Scattered smiles because 7% of growth in such a difficult period lays the groundwork even for a review of the government’s assessment for the full year. I’m not saying that, he says Christos Staikouras in his statement. “These performances lay the foundations for achieving growth higher than expected,” says YPOIK.

If we take as a given based on the data of tourism that the third quarter will be exceptional, then a good second quarter – which also has 2 months of tourism in it, while in April the exports moved exceptionally – could according to the first estimates resubmit government growth estimates from 3.1% to 5%. In such a case, the government would be with an additional € 1.5 billion available financial space However, part of it has already been eaten as measures have been taken – in order to take additional measures to support households and businesses, this time focusing on fuel.