Bank of Greece figures show a significant expansion of the underground economy during the crisis.

As mentioned by the Governor of the Bank of Greece, Giannis Stournaras, speaking at an event on the present and future of savings in Greece, organized by Eurobank and the Athens University of Economics, the underground economy swelled significantly during the crisis period, from 15% of GDP on average in 2000 – 2009 to 26% of GDP in 2015. During the same period a significant reduction in the savings rate is observed.

In contrast, in the European Union (EU) household saving has stabilized at around 13% of disposable income since 2011.

The decrease in household savings is also reflected in the significant decrease in household financial investments.

Specifically, household financial investments (in deposits, cash, shares, bonds and other investment products) decreased from 22 billion euros per year on average in the period 2007 – 2009 to a disinvestment of 6.3 billion euros per year on average in period 2012 – 2019, while, due to economic and political uncertainty, with the reduction of financial investments, households diverted their savings abroad.

As underlined by Mr. Stournaras, Greece should implement policies to strengthen national savings (by approximately 9 percentage points of GDP), in order to maintain both external and fiscal sustainability and cover the significant investment gap.

In any case, as he said, given the significant share of household savings in national savings and the significant deviation from the European average, measures should mainly be taken to strengthen household savings and the private sector in general.

Finally, as the governor of the Bank of Greece argued, the creation of the fifth banking pillar will lead to an increase in interest rates on time deposits, encouraging household savings.