A decision last month to impose a three-week partial lockdown in the country – already extended to Dec. 7 – will more drastically affect the Greek economy than previously foreseen, Bank of Greece Gov. Yannis Stournaras warned on Tuesday.
Speaking during the American-Hellenic Chamber’s 31st annual Greek Economic Summit, Stournaras said an implosion of economic activity in the fourth quarter of 2020 will be greater than previously expected, and by extension will exacerbate figures for the entire year. The recession in the first half of the year recorded a 7.9 percent reduction in GDP.
At the same time, he said that while the ongoing pandemic will worsen many of the problems that mushroomed since 2010, when Greece found itself in an unprecedented economic crisis characterized by a skyrocketing public debt, high unemployment and a “mountain” of NPLs, a “silver lining” can be found in the hike in private bank deposits, up by 12 billion euros since the beginning of 2020.
Stournaras, a former finance minister in the pre-SYRIZA era, painted to increased credit expansion, especially towards major companies, sans credit institutions.
His comments came on the same day as a rather pessimistic forecast for the Greek economy in 2021by the Organisation for Economic Co-operation and Development, which forecast a recession in coronavirus-battered 2020 of 10.1 percent, followed by only an anemic 0.9-percent growth in GDP.
Real GDP growth will return in 2022, the OECD said, but still not covering 2020’s losses, with growth of 6.6 percent forecast.
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