By Stelios Kandias
Strengthening households and businesses with targeted measures, and fiscal stability, is the dilemma that the government will follow, as stressed by the Minister of Finance Christos Staikouras in 7th Delphi Economic Forum.
“Uncertainty is my biggest concern. We have had successive crises, we try to pursue the best policies at home and abroad,” he said.
As for inflation, he explained that its growth before the Ukrainian crisis was largely due to the strong recovery of European economies, and then came the Russian invasion to aggravate the situation.
Downward growth and upward inflation will be revised, in all countries, however, said on the budget. The 2022 budget will change to key assumptions, he admitted, because of the effects of the war. Reiterating that the supplementary budget will be submitted to Parliament within the week.
He emphasized the need to focus on European issues, and said that it was even more important now with the crisis over Ukraine. The main source of inflation is energy explained.
It is possible to implement optimal policies with a view to the next day, but with flexibility to deal with short-term crises, he assured.
“We keep ammunition”
“We are keeping ammunition and for the future we do not know the intensity and extent of the problem,” said Christos Staikouras.
He recalled that the government gave 42 billion euros in the midst of a crisis in a targeted and effective manner. The economic climate has improved, the country has been upgraded, a safety net has been spread for households and businesses in need, he noted. At the same time we reduced taxes and insurance contributions and created a stable economic environment for banks.
“Not only a consensual policy is enough, but a far-sighted bonus policy with cash of 40 billion. The fact that they exist does not mean that they should be used prudently because the deficit is increasing, Greece is under enhanced supervision and does not yet have an investment grade.”
For 2023, this will be decided in May (Eurogroup), or for the next years the country will have to tend towards fiscal balance, clarified the Minister of Finance.
However, he was optimistic that there would be a change and flexibility in fiscal rules, as Europe seems to have learned from the mistakes of the past, with the logic of the North-South bloc no longer being so distinct under a joint Spanish-Dutch proposal.
High economic growth
We will have high economic growth in 2022, and in the coming years he assured. Greece will be a champion in investments and exports in the coming years.
The goal is to reduce red loans from banks. Two systemic banks have achieved this goal since 2021. Our investment firms are upgrading. All the evidence shows that we will achieve the investment level despite the problems. He also pointed out that priorities are the utilization of EU funds and the gradual return to surpluses.
We will make a second brave increase in the minimum wage. With targeted measures to support the disposable income of the citizen such as subsidy in gas and electricity in the primary sector.
In the past weeks, some measures were announced while we permanently reduced ENFIA, the minister added.
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