The increased income from tourism and other service exports covered the decrease in product exports in the first half of 2024, contributing to the growth trajectory of the Greek economy.

According to her data Bank of Greece for the balance of payments, tourism revenue increased by 755 million euros compared to the first half of 2023, reaching 6.9 billion. euro. Overall, receipts from exports of services – which include transport, dominated by shipping foreign exchange – rose by almost €1.5 billion to €7.2 billion, while exports of goods fell by €743 million to €24.7 billion euro.

This highlights the increasingly important role of tourism and overall intangible resources for the development of the Greek economy, even at a time when the Eurozone economy is stagnating. These conditions have contributed to the reduction of Greek product exports after their impressive surge in the two years 2021-2022, when they almost doubled, reaching 53.8 billion euros from 28.9 billion euros in 2020 (in 2019, before the coronavirus , amounted to 32.4 billion euros).

Service export earnings in the first half of 2024 amounted to 87% of product exports compared to 78% in the first half of 2023. Given that tourism receipts are usually double in the second half of the year – as the bulk of tourists come in July and August – this figure is expected to be significantly higher for the year as a whole and likely to exceed 100%. Indicatively, last year the corresponding percentage reached 99.3%.

Exports of goods fell in the first half of the year more in constant prices than in current prices (by 5.9% vs. 2.9%), suggesting an increase in their prices of about 3%. In contrast, product imports rose 3.4% at current prices to 42.2 billion. euros and by 3.8% in constant prices, which means that their prices were slightly lower than in the first half of 2023.

The increased imports are explained by the growth of the Greek economy – in the first quarter of this year the GDP increased by 2.1% on an annual basis compared to an increase of 0.4% in the Eurozone – while it is possible that there has been some substitution of domestic products in a period when inflation led to changes in relative prices.

Imports of services – that is, payments made by Greeks for tourism abroad or for transport and other services – increased by 900 million euros in the first half, reaching 14.1 billion. euro.

The surplus in the balance of services increased by about 550 million euros to 7.2 billion. euros, covering more than 40% of the deficit in the product balance. Thanks to this, the current account deficit was significantly reduced to 8.8 billion. euro, which is an indicator taken into account by investors and rating agencies.

The current account deficit was covered by capital inflows, mainly for investments in Greek government bonds and the purchase of shares of Greek companies.