By N. Stasinou
[email protected]
The IMF has lowered expectations for Greek economic growth, with a report on Friday citing lower forecasts for both the ongoing year and 2020. Additionally, the Fund foresees lower primary budget surpluses (as a percentage of GP).
Specifically, the IMF foresees a GDP hike of 1.8 percent this year, down from last year’s 1.9 percent and the target of 2.0 percent. The forecast for 2020 is 2.3 percent, down 2.8 percent ascribed in the state budget. At the same time, the IMF’s forecasts appear fully harmonized with those of the European Commission.
In terms of fiscal targets, the Fund foresees a 3.7 percent – of GDP – primary budget surplus this year; 3.1 percent in 2020; 2.7 percent in 2021 and 2.6 percent in 2022.
Conversely, the Commission foresees that the Greek state will meet the 3.5-percent target in 2021 and 2022, as mandated by European creditors.
A Bloomberg dispatch on the IMF report regarding Greece notes:
“Over the longer term, the fund’s view “continues to be that debt sustainability is not assured under a realistic set of macro-fiscal assumptions…To give breathing space, the IMF says Greece’s fiscal targets should be reduced from an annual goal up to 2022 of 3.5% of GDP. “Reducing fiscal targets to create more space for investment and social spending would also support the economic and social recovery,”
