Govt still hopes Oct. revision of 2017 GDP will reach forecast

Tuesday, 06 March 2018 22:53
SOOC/Alexandros Michailidis

By T. Tsiros

Reduced state spending in order to achieve an over-performance in fiscal targets, as well as mostly stagnant household spending despite extraordinary welfare payments doled out by the leftist-rightist coalition government in December 2017, accounted for lower than forecast GDP growth last year.

The result for 2017 was an increase of 1.4 percent of GDP, yoy, off by 0.2 percent from the forecast included in the state budget for the year and autumn predictions by the European Commission. A final revision for 2017 comes this October.

The government's economic team, nevertheless, hopes that inclusion of all available data, especially a better-than-expected retail season in December 2017, will eventually raise the GDP growth figure to the previous goal. Another argument heard in Athens this week is that the difference, 0.2 percent, is within the margins of a "statistical error".

Nevertheless, when final negotiations with creditors are held in May over fiscal targets for the next few years, i.e. the timetable for imposing already agreed to austerity measures and possible "countervailing" measures, the figure on the table will be 1.4 percent.