Athens Digest 27.06.2019

• Government extends special VAT rates for 5 islands

• Exxon, Total to sign deal for Crete offshore exploration

• Report: 83 percent of national debt is to official sector

• IOBE: Industry investment slump expected in 2019

• Afantou deal on Rhodes finally completed


# The government has extended lower VAT rates for five Greek islands where travel restrictions remain imposed for asylum seekers arriving from nearby Turkey. The six-month extension is valid through December 31 and was signed by Finance Minister Euclid Tsakalotos and his deputy Katerina Papanatsiou. It affects the islands of Lesvos, Chios, Leros, Samos, and Kos. VAT concessions have frequently been a contentious issue in negotiations between the government and bailout creditors.

# Greece will sign an exploratory drilling agreement today for two areas off the coast of Crete with ExxonMobil, Total and Hellenic Petroleum. Prime Minister Alexis Tsipras is due to attend the signing ceremony and make remarks, while the agreement will be signed by Energy Minister George Stathakis and Yannis Bassias, president and CEO of the Hellenic Hydrocarbons Resources Management agency. Hellenic Petroleum has a 20 percent stake in the deal, with the remainder evenly split between Exxon and Total. The marine regions covered in the deal are 20.5K sq kilometers and 19.8K sq kilometers.

# Eighty-three percent of Greece’s national debt is owed to the official sector following three successive bailout programmes, according to the 2018 report by the Public Debt Management Agency. The official sector share was just 16 percent in 2010. The national debt reached EUR 334.5 billion in 2018 or 181.1 percent of GDP by the end of last year. The main challenges facing the economy, the report said, are the high volume of nonperforming loans, the lack of liquidity, and unpaid state arrears.

# The Foundation for Economic and Industrial Research says industry investment is expected to drop by 1.1 percent this year, despite previous expectations of an increase.IOBE’s latest survey included results from March and April. A decrease of 6.9 percent was recorded in total manufacturing investment in 2018 compared to 2017, although the previous survey predicted a significant investment growth of 27.3 percent.

# The privatisation agency HRADF says it has signed a EUR 15.2 million agreement with T.N. Aegean Sun investors to utilize 269,000 sq meters at Afantou on the island of Rhodes. The deal completes the long-sought agreements for Afantou after a sperate part of the property was also licensed earlier this month.



On our Radar: Pump evasion 
The Independent Authority for Public Revenues says half the filling stations checked by its inspectors do not have electronic tax meters at pumps for natural gas products on sale to motorists. The meters are used to report transactions directly to tax authorities _ a measure that was introduced to combat once-widespread tax evasion in the industry. Out of 275 filling stations inspected this month, 123 were listed as being non-compliant.