New measures will provide temporary relief for Greece

Abstract

\n Significance\n The new forecast is based on strong results in the second quarter, better-than-expected tourism revenues over the summer months and the approval of the Greek Recovery and Resilience Plan by the European Commission in July. Mitsotakis also announced several new measures, including tax cuts to stimulate spending.\n \n \n Impacts\n High unemployment (14.2% of the labour force) and structural labour market weaknesses will constrain growth. \n Structural reforms lost momentum during the pandemic, dampening medium-term economic growth prospects.\n Public opposition to vaccination might necessitate new movement restrictions by year-end, inhibiting growth.\n Availability of a EUR30bn liquidity buffer will support sovereign ratings and investor interest in the short term.\n Short- and medium-term public debt refinancing risks remain low as 75% of debt stock is held by the official sector.\n