Athens Digest 24.04.2019

• Greece outperforms surplus target in 2018

• PM Tsipras tells FT he wants a new policy mix to reach the targets but with a higher growth rate

• Mitsotakis pledges sweeping tax cuts in Bloomberg interview

• New Democtacy to file censure motion against minister over comment about disabled MEP candidate

• EPP’s Weber launches European election campaign in Athens

• Public Power Corporation announces significant losses in 2018 


# Greece’s post programme primary surplus for 2018 reached 4.29-percent of GDP, according to Greek Finance Ministry. The surplus was slightly higher than the ministry’s previous forecast of 3.9-percent of GDP.  Figures of the Hellenic Statistical authority (ELSTAT) consistent with ESA 2010 guidelines showed a primary surplus of 4.4-percent of GDP- excluding debt servicing outlays. According to Eurostat, Greece’s consolidated gross government debt climbed in 2018 to 181.1-percent of GDP from 176.2-percent in 2017 while the general government registered a surplus of 1.1-percent of GDP.

# In an interview with the Financial Times, Prime Minister Alexis Tsipras referred to the surplus stressing that Greece has “achieved these targets, and outperformed them too, for four consecutive years.”  He added, however, that he hopes Greece may soon be able to agree with its creditors on “a new policy mix in order to reach the targets but with a higher growth rate.”

# Describing Greece’s economy as “overtaxed,” New Democracy leader Kyriakos Mitsotakis told Bloomberg TV yesterday that his government will, over two years, cut corporate tax from 28-percent to 20-percent and real estate tax by 30-percent. The conservative president also vowed to slash VAT on food and beverages from 24 to 13-percent immediately. “We can afford these tax cuts even without negotiating the primary surplus,” he said.

# New Democracy announced yesterday that it will file a censure motion against Alternate Health Minister Pavlos Polakis after the Easter break in response to a controversial social media comment he made about a disabled conservative candidate in next month’s European Parliament elections. Polakis highlighted that wheelchair-bound Stelios Kymbouropoulos had followed a hiring law supporting disabled people to secure his appointment as a physician at the Greek National Health Service (ESY). The comment sparked indignation across the political spectrum and even within ruling SYRIZA. However, Prime Minister Alexis Tsipras, who did not condemn Polakis’ remarks, said that if the motion is submitted he would turn it into a confidence vote for his government. Polakis, a smoker, was slammed earlier in the year by EU Health Commissioner Vytenis Andriukaitis over his disregard of legislation banning smoking in public places including the Ministry of Heath.

# Manfred Weber launched his European election campaign in Athens last night, firing back at critics who have accused him of pandering to the growing populist right around the bloc. “In 2019, we will fight against those who want to destroy our Europe. The nationalists will become our enemies and we will fight them,” he said speaking at his launch event in Athens. In an interview with the Associated Press, he said he hoped Britain could ultimately remain in the EU but called for greater clarity from London. Weber played down comments he made about Greece during the financial crisis, maintaining that he always fought to defend the euro currency and the member states that use it.

# The Public Power Corporation (PPC) announced significant losses for 2018 yesterday to the tune of EUR 542 million after tax triggering a shock to the local market. Operating profits declined by 44.55-percent y-o-y while turnover fell by 4.1-percent. The could have been higher but the activity of the Meliti and Megalopoli plants which are up for sale were not included in the calculations.



On Our Radar: Greece lagging in the use of digital money  
Greece is ranked 55th out of a total of 84 countries in the use of digital money, according to the Federation of Hellenic Information Technology & Communications, Enterprises (SEPE), citing data of Citi’s Digital Money Index. The Index groups countries in four categories, depending on their readiness to adopt digital payment means: incipient, emerging, in-transition, materially ready. Based on the research Greece is in the second category of emerging markets. Countries topping the list include Finland, Sweden, Norway, the US, UK, Holland, Denmark and New Zealand.