The Greek economy has proven resilient to crises over the last four years, and this is not just claimed by the government. It is demonstrated by the economic indicators themselves: records in Foreign Direct Investments and exports, the third-highest growth rate in the EU in 2022, a significant reduction in public debt as a percentage of GDP, successive upgrades in the country’s creditworthiness, and a reduction in unemployment to pre-crisis levels!
One might wonder: Will this trend continue?
Undoubtedly, there are significant challenges in 2024 that demand our attention to minimize risks and maximize opportunities. The combination of political stability with the implementation of the right mix of economic policies is what sustains our optimism for the future. Of course, our economy is not enclosed in protective glass. So, what are the key challenges for the Greek economy in 2024?
The first challenge: maintaining the resilience of our economy to crises. This requires a combination of fiscal seriousness on one side – the foundation to convince domestically and internationally that we are reliable – and development policies on the other. These are complementary goals for us. That’s why we are determined to continue steadfastly achieving our fiscal targets – especially as in 2024, we aim for a primary surplus of 2.1% of GDP – further improving the country’s creditworthiness and continuing the de-escalation of public debt!
The second challenge: enhancing the competitiveness of the Greek economy. For this, we emphasize sectors where we have a competitive advantage (pharmaceuticals, agri-food sector, Renewable Energy Sources). Simultaneously, we continue efforts to improve the business environment by accelerating justice delivery, modernizing the public sector (e.g., digitization), and strengthening the Banking System, with recent successful recapitalization by the Financial Stability Fund from Eurobank, Alpha Bank, and 22% from the National Bank.
The third challenge: increasing the economy’s external orientation to raise exports to 60% of GDP by 2027 and 70% by 2030. How? Providing incentives for business innovation to shape more globally competitive products, encouraging business growth (a task force has already been established in this direction), and supporting businesses in the digital and green transition. The Recovery Fund is a significant ally in this effort!
The fourth challenge: limiting tax evasion with 11 different initiatives included in the recently passed law by the Parliament. Among them: generalizing electronic invoicing, restricting the use of cash, implementing strict measures to combat fuel smuggling, modernizing the framework for short-term rentals, and promoting a fairer taxation system for freelancers, with a reference to the salary of an employee earning the minimum wage and scaling, of course, according to the number of employees and the turnover of each business.
The fifth challenge: more effective utilization of Public Property, with the establishment of a separate Secretariat for Public Property and the restructuring of the Hellenic Republic Asset Development Fund (HRADF). We start with the more mature among the tens of thousands of properties owned by HRADF so that results can be achieved more immediately! In our agenda, we include, among other things: Properties in the Athenian Riviera and ski resorts managed by HRADF. Utilization of the remaining regional airports. Leases of the ports of Heraklion and Volos (preceded by the ports of Igoumenitsa and Kavala). Completion of the concession of Egnatia Odos and Attiki Odos. As well as all necessary steps for the entrance of Eleftherios Venizelos Airport into the Stock Exchange.
The sixth challenge: increasing disposable income. Here, the main issue is inflation. As there are no “magic erasers” to eliminate it, we proceed with three specific efforts: Firstly, inspections by the Directorate for Market and Consumer Protection of the Ministry of Development and the efforts of the Competition Commission. Secondly, extraordinary income support, especially for the most vulnerable. And thirdly, permanent income support, the most significant of which is the increase in pensions, as well as wages in the public and private sectors (minimum wage). At the same time, without ignoring the capabilities of businesses, we also consider three-year plans in the private sector. But also our goal of increasing the average wage to €1,500 by the end of the four years. Already in the previous four years, the average wage reached €1,176. This year, we expect an increase of 7%. That is, we will close in 2023 with an average wage of around €1,250. Thus, steadily approaching the four-year target!
This is our plan for an economy that will remain resilient to crises in 2024. We will not let progress go to waste! Especially after what we experienced in the past decade, we must not allow ourselves to repeat it. With our policy, the economy is moving forward dynamically, and with it, our homeland is rising higher!
*Kostis Hatzidakis is the Minister of Finance of the Hellenic Republic
