The Governor of the Bank of Greece referred to SKAI on the effects of the Russian invasion on the Greek economy and the economy of the Eurozone Giannis Stournaras, noting that at the moment there is still uncertainty, and all scenarios depend on what will happen in Ukraine.
As the BoG commander clarified, “the West has decided that respect for international law and democracy is above all, so it has imposed sanctions that they affect the same citizens of the West. ”
Russian economic power
He clarified that Russia is a very large country, but it is not a great economic power, it is below 3% of world GDP, ie it has, for example, the size of the Spanish economy.
“Our dependence is very low on goods and services, but Russia is an energy giant, it produces over 10 to 11% of world energy… Collapse of the Russian economy will not shake the world financial system in goods and services, and financial services, but clearly there will be a significant impact on the energy sector. ”
Especially for Greece, he said “We import 20% of oil and 40% of natural gas from Russia, and if you take into account that 2/3 of our energy needs are imported, we are moderately dependent “.
“The impact on the Eurozone from the Ukrainian will be a reduction of the growth rate by 0.5% with the assumption that hostilities will end quickly. The much worse case scenario predicts a 2% reduction in the growth rate – from 4.2% to 2.2% – ie we do not see a recession. “We do not see stagnant inflationary trends, but a recession with a negative growth rate,” said Giannis Stournaras. “We do not see that inflation will be perpetuated in 2023 and 2024He assured.
“The ECB has an open umbrella for Greek bonds”
The ECB, said the governor of the BoG, will not stop buying bonds neither for Greece nor for the other countries. “We have decided (as the Governing Council of the ECB) to reduce net markets, but the ECB’s balance sheet will not be reduced, when the markets stop, there will be repurchases, reinvestments,” he explained.
“The ECB has ‘the umbrella open’ cfor Greek bonds. “Monetary policy is expansive, and it will be expansive for many months to come.” He added that in 2023 the rule that every country should reduce will not apply by 1/20 its debt. “We do not know if a general relaxation of the rule will apply as until today,” said Mr. Stournaras.
“We must take careful steps”
“The government gave from the largest amounts “This is reflected to some extent in the fact that a significant number of business households and the state have significant reserves to deal with an important event like this,” he said. “I do not see that inflation will last for a long time,” said the BoG governor. But, he added, to take careful stepsnot big steps, until this crisis is over. “You do not know what will wake you up” Mr. Stournaras stated characteristically, pointing out the coordinated European attitude in the economy as well.
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