Analysts fear Greek recession could persist

Analysts fear Greek recession could persist

Athens, August 12, 2016/ Independent Balkan News Agency

By Zacharias Petrou

A weekly report by Eurobank Research analysts says the Greek lender expects GDP to show a negative growth rate in the second quarter – the fourth consecutive quarter in recession.

It is also pointed out that the return to growth from the second half of the year onwards is seen as crucial in order for Greece to avoid economic stagnation.

GDP flash estimates for the second quarter are due for release on August 12.

“Real GDP is projected to shrink in the first half of the year largely due to the anticipated reduction in private consumptions and exports,” Eurobank Research said.

Greece’s economic recovery in the second half of the year will be dependent, among others, on households and businesses’ expectations over the course of the economy; the improvement of the local financial conditions; the second review of the country’s adjustment program; and the international economic and political developments.

As of next week, government officials will meet to prepare for negotiations with creditors in the autumn.

The negotiations are expected to focus on tough labor reforms. Earlier this week, Labor Minister Giorgos Katrougalos rejected media reports of retroactive cuts in main pensions, labelling them as a “new wave of misinformation.”

The government has vowed to reject demands for further austerity measures over the course of the 2nd bailout program review, and to protect primary home owners from foreclosures when the management of non-performing loans is discussed with creditors in coming weeks.