Athens awaiting key economic reports

Athens awaiting key economic reports

The International Monetary Fund (IMF) is expected to publish a report on the Greek economy in coming days, which will be followed by the fourth post-bailout European Commission report, which is expected to assess the impact of the 2020 budget, which is expected to be ratified in parliament by the end of November.

On 4 December, the Finance Minister, Christos Staikouras, will attend a Eurogroup meeting which is highly anticipated as it is set to determine the result of the 4th post-bailout review of the Greek economy by international creditors.

The IMF report is expected to focus on certain areas of the economy and issues that need to be addressed. The Washington-based Fund is set to reiterate its view that primary surplus targets need to be lowered; it is also expected to project growth in 2020 to come in at 2.8 percent.

More importantly for Athens, the IMF will reportedly urge the government to further reform the social security system, slash the tax-free income threshold, take action to address non-performing loans and widen the tax base.

On its part, the European Commission is expected to cite areas in which reforms need to be carried out at a faster pace. Nevertheless, in recent talks with Greek officials, the country’s European creditors appear to have reached agreement with Athens on the key provisions of the 2020 budget.

Moreover, data on the execution of the state budget for the first 10 months of 2019 will be published imminently. The figures will show if the rate of tax collection is enough to ensure a fiscal gap doesn’t open up this year, and if primary surplus targets will be exceeded.

The Mitsotakis administration plans to use any excess fiscal space to repay debts to pensioners and distribute an emergency “social dividend” this year, in support of low-income earners./ibna