The Greek economy has entered a recovery path, supported as well by the favorable external environment, the Hellenic Federation of Enterprises (SEV) announced in its monthly bulletin for December under the headline “Recovery at last! Now comes the difficult part?”, according to ANA:
The deal for the 3rd review of the adjustment programme was expected to further improve the economic climate, accelerating growth in last quarter of 2017, and in 2018 as a whole. However, the trend in investment is still problematic and private consumption was recovering relatively slowly, as over-taxation continued to compress household disposable income, the report said.
The significant rise in imports also reflected the country’s still weak transformation progress into a supply-side economy driven by manufacturing, SEV noted. On this basis, a sustainable economic recovery in the medium term requires that the exit from the 3rd Memorandum in August 2018 is smooth without discontinuities in the economic policy. Otherwise, the market reaction will be rapid and rising interest rates will quickly reverse the good climate, it warned.
The report also pointed to a decline in interest rates and yield spreads on 10-year Greek bonds, saying that this improvement was expected to continue in 2018 barring any adverse developments.
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