Athens Digest 09.07.2018

• IMF mission chief in Greece says primary surplus targets could impede growth

• EWG’s Vijlbrief: Continuing reforms is key to growth, rolling back is self-defeating

• German Defense Minister says deal with Greece on migrant returns could be signed by end of July

• New Democracy extends its lead over ruling Syriza, according to new poll

• Illegal e-betting spikes during World Cup


# The IMF mission chief in Greece, Peter Dolman, has warned that the future growth of the Greek economy could be compromised by the high primary surpluses it must achieve in coming years. In an interview with the Kathimerini newspaper, he said the bailout exit deal last month will improve “Greece’s prospects for accessing the markets,” in the medium term, but noted that primary surplus targets of 3.5 percent until 2022 and 2.2 percent until 2060 will “constrain the government’s ability to promote growth.” “As a member of the eurozone, Greece has lost the ability to implement an independent monetary policy. The fiscal constraints mean that there are very few tools left with which to boost economic activity,” he said. “At this time, we consider the realistic forecast for real growth in Greece is 1 percent annually.”

# EWG president Hans Vijlbrief insists that Greece has positive economic prospects provided that structural reforms continue, NPLs are tackled and that the pre-legislated package of reform is implemented. In an interview to “Proto Thema,” he said that not rolling back and continuing reforms is key for credibility and growth. His comments follow the recent visit to Athens by Commissioner Pierre Moscovisi who said, in reference to planned pension cuts, that “commitments must be respected” but that “they are not rigid.” When asked if there is room for flexibility to suspend cuts, Vijlbrief said the pre-legislated package with pension and tax reform as well as contingent countermeasures were about safeguarding the credibility of the budget. “Anything else is self-defeating and Greece should not want to go down that road again,” he said.

# With pressure mounting on Berlin over the refugee crisis, German defense minister Ursula von der Leyen has suggested that a bilateral accord with Greece for the return of migrants could be signed by the end of July. “We want an agreement with Greece by the end of the month,” she told the Funke publishing group, adding that such an accord could set an example for other countries.

# Opposition New Democracy has increased its lead over ruling Syriza by 1.1 points since March, according to a new nationwide poll conducted by KAPA research. More specifically, the survey of 9,800 respondents – conducted between June 25 to July 2 – showed that New Democracy has a 5.5% lead, with 23.3% compared to 17.8% for Syriza. Extreme right Golden Dawn was third with 8.9%. In a previous KAPA poll in March, the conservatives had a lead of 4.4 points, with 21.6% against 17.2% for Syriza. The poll also showed that 41% would vote in the election to protest against the recent deal between Greece and FYROM to settle their decades-old name dispute.

# Illegal online betting has spiked during the 2018 World Cup, with Greece’s Gaming Commission saying that it has added a further 1083 sites on its Black List. In total the list, so far, includes 2708 non-licensed websites.



On our radar: The… panic button of tax evaders
Several businesses have reportedly found new ways to evade tax this summer with the help of special software that tampers with receipts to conceal real turnover and mislead inspectors. In a report, the Independent Authority for Public Revenue (AADE) listed a wide range of methods used to conceal revenue. Among them is a system whereby a receipt is electronically recorded but not issued by the printing machine linked to the tax system network. At the end of a business day, electronically recorded receipts are deleted. In the event of an unexpected visit by tax inspectors, a so-called “panic button” is pressed to print receipts with dates prior to the audit. Officials says culprits have honed their skills of deception and inspectors must be specially trained and remain vigilant to tackle the issue.