OECD expects Greek GDP to expand by 1.1% y-o-y in 2017

Thursday, June 8th, 2017
Last Update: 12:39

OECD said in its June’17 Global Economic Outlook that it expects the Greek economy to grow by 1.1% y-o-y in 2017e and +2.5% in 2018e (vs. EC’s latest forecast of +2.1% and 2.5%, respectively).

According to OECD, the labour market is improving, supporting private consumption, and higher demand from abroad is boosting exports, while investment has started to recover from very low levels and should gather pace. In addition, the consumption tax increase in early 2017 and recent energy price increases will raise consumer price inflation, even though core inflation will remain moderate, as ample spare capacity persists.

On fiscal targets, OECD said that in 2016, the primary budget surplus was 3.8% of GDP, well above the 0.5% target, and the overall budget is now essentially in balance.

Public spending control, including an undershooting of the public investment target, and buoyant tax receipts, due to improvements in tax compliance but also to one-offs relating to tax arrears, contributed to this achievement. Over the projection period, the primary surplus is projected to decline but remain high, above 2.5% of GDP.

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