The six priorities of the Greek economy at the Staikoura – Gramegna meeting

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“In today’s adverse circumstances, the Greek economy has shown remarkable resilience” said the Minister of Finance in his meeting with the Executive Director of the ESM

In the six priorities of the Greek economy – given that the international geopolitical waters are still stormy, inflation is decreasing but remains high and persistent and the monetary policy is becoming more and more restrictive – referred to the Minister of Finance Christos Staikouras, in statements after his meeting with the Executive Director of the European Stability Mechanism (ESM) Pierre Gramegna.

As the minister said, the priorities consistently include:

– ensuring existing fiscal responsibility,

– dealing with the economic effects of multi-level crises, making use of the available – each time – fiscal space,

– the implementation of structural changes,

– the forward-looking utilization of the resources of the Recovery and Resilience Fund,

– dealing with the high, accumulated private debt,

– the country’s active participation, as it has been for the last 3.5 years, in shaping the new European economic architecture.

In detail, the position of Mr. Staikouras is as follows:

“Dear friend Pierre, honorable Mr. Gramegna. It is with great pleasure that I welcome you to the Ministry of Finance.

Your first visit to Athens today as the Executive Director of the European Stability Mechanism demonstrates the importance you attach to continuing and further strengthening the regular, effective and mutually beneficial cooperation between Greece and the ESM. Partnership which, under the leadership of your predecessor Mr. Klaus Regling, had these characteristics. I’m sure she will continue to have them throughout your days, and become even more productive.

Your many years of experience as your country’s finance minister and a member of the Eurogroup during the difficult times of the past decade, and our creative cooperation in the Eurogroup and Ecofin for 2.5 years – during which we were all again faced with particularly unfavorable international circumstances – are a guarantee for it.

Today’s situation is, again, critical and full of challenges, due to successive external tests. In these adverse circumstances, the Greek economy has shown remarkable resilience, has strong momentum and is characterized by positive prospects. The above is reflected in almost all the main indicators of the economy.

In the strong and stable growth, in investments and exports that are significantly strengthened, in unemployment that is shrinking, in economic inequalities that are reduced, in the non-performing loans of credit institutions that now form a single-digit percentage of all loans, in the deposits of households and businesses that have grown impressively in the last three years, to public finances that have stabilized and are on a trajectory for further improvement, and finally to the enhanced prestige and increased credibility of the country.

All this is also reflected in the 11 upgrades of the Greek economy in the last three years, now reaching one step before the investment grade and making realistic the goal of its recovery within 2023. The aforementioned positive developments also included a series of achievements.

Specifically, Greece:

-He completed last April the early repayment of loans to the International Monetary Fund, sending a positive message to the markets, saving resources from the state budget and strengthening the public debt profile.

-It successfully exited last August, from the Enhanced Supervision regime, closing the painful chapter of the financial crisis of the last decade, and returning to European normality.

-Proceeded last month in the early repayment of bilateral loans with Eurozone countries (GLF), amounting to 2.7 billion euros, which were concluded in the framework of the 1st Memorandum.

-Achieved the largest reduction of public debt within the European Union since 2019. In particular, the debt of the General Government, as a percentage of GDP, has dropped impressively by 50 percentage points in the last three years.

Moreover, as of this year public finances are returning to an environment of primary surpluses, registering – according to the European Commission – the largest fiscal improvement in Europe in the period 2021-2023. It applies an efficient, far-sighted publishing strategy, which allows it to draw resources from markets on satisfactory terms, as demonstrated by the recent issuance of a 10-year bond, keeping its cash reserves at safe levels.

All of the above is the result of the effective economic policy of the government and the hard, joint effort of citizens and the state, from July 2019 until today. Since the beginning of our mandate, we have implemented a different, modern economic policy mix, based on prudent fiscal policy, implementing reforms, stimulating investment and making the best use of available European resources.

At the same time, we designed and implemented a responsible, economically efficient and socially fair network of interventions to support households and businesses against the effects of successive exogenous crises. Support which is brave, but without undermining fiscal stability and undermining the future of the economy and the country.

But despite significant achievements, the challenges ahead are great and the situation remains difficult and fluid, as international geopolitical waters remain turbulent, inflation is declining but remains high and persistent, and monetary policy is becoming increasingly accommodative. .

That’s why our priorities consistently include:

-ensuring existing fiscal responsibility,

– dealing with the economic effects of multi-level crises, making use of the available budget space,

– the implementation of structural changes,

– the forward-looking utilization of the resources of the Recovery and Resilience Fund,

– dealing with the high, accumulated private debt,

– the active participation of the country, as it has been for the last 3.5 years, in shaping the new European economic architecture. Architecture that must ensure long-term stability and sustainability of public finances, offering the necessary flexibility to manage the economic cycle, ensuring successful response to future crises, encouraging public investments that increase sustainable development, strengthening national ownership of its provisions, maximizing synergies among the components of the overall policy mix.

In this context, the role of the ESM is particularly important and can be strengthened for the benefit of further stimulating financial stability in the eurozone. After all, it is clear that in the historical period of increased challenges that we are going through, no European member state can face these challenges by itself. This is why coordinated European action is required.

Dear Pierre. I am sure that your contribution in this direction will be important. I wish you, once again, the best of luck in your pivotal new role and thank you for our creative collaboration.”

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