Research from the Unions and from the business sector points to moderate optimism

by Antonis D. Papagiannidis

The research institute of the General Confederation of Greek Workers (GSEE) is – for once – more or less aligned in the findings of its mid-year November 2023 Report, with those flowing from the review of the business-close Foundation for Economic and Industry Research (IOBE) covering the same time-frame.

IOBE publicized data setting out an overall positive feeling, with consumer confidence turning positive after some months of gloom. Moreover, expectations are increasingly positive in retailing and the services sector (fueled by consumer confidence), while the guarded positions of industry/manufacturing and construction do not tip the balance negatively.

From its own view-point, the research institute of the Unions speaks of growth being supported by consumer spending along with exports (mainly of services, which point to the good tourist season); investment is recorded at better/stable levels (although still lagging behind EU levels); noted also with some uneasiness is the increase of imports, which goes hand-in-hand with sustained growth in the economy.

Shifting to the fiscal situation, IOBE was willing to underline a small primary surplus in the execution of the 2022 budget (while initially a primary deficit was penned-in for the year, at levels comparable with the 2021 deficit). Part of the good performance over the first three quarters of 2022 is attributable to faster payment of property taxes, but also to significantly of VAT, and excise duties collection.

Coming back to the Unions’ point of view, fiscal equilibrium is viewed with some circumspection due to the burden imposed by the pandemic as well as by the current inflation situation. Expected primary surplus is mentioned for 2023, with some hesitation as to the budget’s persuasiveness. The contribution of VAT performance, as well as of escise duties on gas and other consumption taxes is also mentioned – this time along with the point that such taxes weigh disproportionately on lower-income households.

So, the last month of a difficult year starts with wider optimism of a moderate kind; an optimism assorted with a respectable amount of reservations.