Negotiations on a second review of the Greek program and implementation of immediate tax relief measures for enterprises need to be completed within March, the Federation of Hellenic Enterprises (SEV) said in its weekly bulletin on economic developments.
“The agreement in principle reached in the Eurogroup meeting for the resumption of negotiations between technical groups of the institutions and the government, is a positive development and justifies optimism for the completion of the second review, but without neutralizing uncertainty. These negotiations should be completed quickly and safely in March, if we want not to lose financially another year, and producing a direct effect capable to lead the country to recovery and back to capital markets,”SEV said.
SEV noted that “a reduction of over-taxation needs to be sorted out immediately and not in 2019 as rumored, otherwise it will be an empty gift for “spluttering Greek enterprises” and referred to the confidence gap existing between the institutions and our country which postpones taking difficult but vital for the economy decisions to the future. The authors of the bulletin noted that a reduction in bank deposits caused by uncertainty until June 2015 was repeated again but it has taken the form of non-repatriation of export receipts abroad.
“This is highlighted in reduced inflows from tourism, transport and other services, recorded in the external trade of the country balance, at a time when the European and the Greek economy to some extent, have returned to higher rates of economic activity. SEV also refers to the financing difficulties faced by Greek companies, particularly SMEs.
More specifically, the rate of discouragement and rejection of SMEs’ applications for funding in the previous six months was around 25% – 30%, while in the Eurozone it is lower than 10%. Moreover, the average rate for new loans between 250,000-1 million euros in Greece is 5.06%, while in the Eurozone is 1.79%.