TIF: Growth with investment on the incense-burner

Posted by Antonis D. Papagiannidis 09/09/2019 0 Comment(s) Economia Blog,

A visible shift of the traditional Prime Minister speech at the Thessaloniki International Fair, away from the pattern of pork barrel promises and toward an investment/ growth discourse. This shift was helped along by the response Kyriakos Mitsotakis got from his visits to Paris and Berlin and his meetings with the heads of Greece’s major European creditors: circumspection over fiscal loosening, but better intentions for investment perspectives. A first concrete result of such shift was the rumoured Eurogroup positive signs for the proceeds of the ANFAs/SMPs Central Banks profits from Greek bonds bought at the peak of the financial crisis, to be channeled to investment purposes. This would create useful fiscal space for the months ahead, even if Greek primary surpluses were not cut back in the near future.


Accordingly, Mitsotakis announced some further tax cuts – but carefully spread over time – and minor spending measures. But his main emphasis was on structural reforms which, along with the tax cuts, would serve as catalysts to investment-led growth.


Add to this the investment-loaded discourse of US Trade Secretary Wilbur Ross, who once more visited Greece, this time days before the Thessaloniki Fair – in 2018, the US was honoured country at TIF. This time round Ross was even more insistent in calling for investment opportunities in Greece, provided of course that an investment-friendly environment was secured. Were one to compare the Ross discourse one year apart, one would find little difference; but truth be told, the current Government is clearly more inclined to secure such investment-friendliness.


Of course, as is always the case when the gods of welfare and prosperity are invoked with investment at the incense-burner (instead of public spending), one should wait for the end-result: growth. Mitsotakis was straightforward enough in acknowledging the fact that he and his Government will be judged on results – at this front.


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