It downgraded its estimates for the development of the Greek economy by one percentage point. International Monetary Fundnow expecting GDP growth of 3.5% in 2022.
The strongest and most persistent increase in energy costs is expected to raise it inflation at 4.5% this year, before it starts to decline.
In its report, the IMF calls on Greece to take back the abolition of the solidarity contribution and the reduction of insurance contributions or alternatively to find financing from other sources.
At the same time, however, it calls for a gradual fiscal adjustment in a friendly way to grow and increase funding for social solidarity income.
In particular, the report states that fiscal adjustment should be gradual and growth-friendly. It recommends a gradual course aimed at achieving a primary surplus of 2% of GDP by 2027.
Plans to permanently reduce insurance contributions and the solidarity contribution for all should be canceled, as they carry the burden on future generations and are poorly targeted or at least not fully funded through adjustments to benefits and measures to broaden the tax base.
The mission welcomed the improvements in the fiscal mix achieved during the pandemic, in particular the higher spending on health and public investment, and stressed that these gains should not be sacrificed to achieve the consolidation goals.
Instead, the pressures for more spending on pensions and salaries of civil servants should be reduced, including by respecting the freeze on pensions this year and an indexation formula from next year onwards.
The IMF also notes that there is still much room for further improvement in the fiscal policy mix with the phasing out of transfers to public enterprises and fuel subsidies in the medium term and tackling tax evasion by the self-employed to create room for critical social investment. funding for the Recovery Fund expires.
Accelerating fiscal structural reforms would facilitate these efforts.
He even proposes to impose a carbon tax that will finance the green transition.
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