The Challenges for the New Greek Government

Related publications

• Strategic Analysis 15 February 2024

  Greece: Time to Reduce the Dependency on Imports

  Dimitri B. Papadimitriou, Nikolaos Rodousakis, Giuliano Toshiro Yajima and Gennaro Zezza
  Abstract

  In this report, Dimitri B. Papadimitriou, Nikolaos Rodousakis, Giuliano T. Yajima, and Gennaro Zezza investigate the determinants of the recent performance of the Greek economy.

  Despite geopolitical instability from the continuing Ukraine-Russia and Israel-Gaza wars and higher-than-expected inflation rates, the country has managed to register the highest growth rates among eurozone member-states in 2021 and 2022.

  Yet the authors’ projections, based on 2023Q3 official statistics, show that there will be a deceleration of GDP growth in the upcoming two years. This will be driven mainly by sluggish consumption demand due to the falling trend of real wages and persistent higher imported inflation, coupled with the inability of the government to deploy NGEU funds and a significant loss of production due to climate damage from floods and fires. These dynamics will likely continue the brain drain of skilled workers, who opt to move abroad for better employment opportunities. The overreliance of the Greek economy on tourism is also questioned, given the dependency on foreign industrial inputs.

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• Policy Notes No.2 26 June 2023

  Οι Προκλήσεις της Νέας Κυβέρνησης στην Ελλάδα

  Dimitri B. Papadimitriou and Nikolaos Rodousakis
• Policy Notes No.1 01 May 2023

  Greece: Higher GDP Growth at What Cost?

  Dimitri B. Papadimitriou, Gennaro Zezza and Giuliano Toshiro Yajima
  Abstract

  In 2022, Greek GDP grew at a higher rate than the eurozone average as the nation’s economy rebounded from the COVID-19 shock.

  However, it was not all welcome news. In particular, Greece registered its largest current account deficit since 2009. Despite a widespread focus on fiscal profligacy, it is excessive current account and trade deficits—largely caused by private sector imbalances—that are at the root of Greece’s multiple economic challenges. This policy note identifies the major determinants causing the deterioration of the current account balance in order to devise appropriate corrective policies.

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