The second half of 2016 will see an economic recovery and stabilisation of growth in Greece, according to the European Commission’s Autumn 2016 Economic Forecasts report published on Wednesday. The report predicted a return to strong growth in 2017 and continued robust growth rates in 2018, supported by higher domestic demand and exports.
“Economic recovery is expected to return strongly in 2017 with growth at 2.7 pct, on account of the assumed gradual normalisation of the financial sector, which should lead to the gradual relaxation of capital controls over time. Domestic demand is expected to increase, with investment fuelling a positive net exports contribution. Investment is expected to take off in 2017 backed by improved credit conditions and EU funding. Real GDP is expected to continue recovering at a robust pace in 2018, with growth forecast to reach 3.1 pct,” the report said.
Regarding unemployment, the report said this was set to continue decreasing from very high levels, while it revised the primary surplus downward in relation to its spring forecast, to 0.2 pct of GDP, and said that Greece’s public debt will peak in 2016 at 181.6 pct of GDP before starting to fall in 2017.