Greece lags OECD peers in export growth

In the years since the financial crisis began in Greece, exports have been considered one of the few lifelines for Greek enterprises and the economy in general. However, rival countries have progressed much more as Greek exports have lost market share.

From 2010 to 2017, the average growth rate of Greek exports was 5.3 percent. However, Greece’s share of service exports among member-countries of the Organization for Economic Cooperation and Development (OECD) fell by 31.8 percent between 2010 and 2015, from 1.35 percent to 0.92 percent. Its share of product exports fell 9.4 percent from 0.32 percent in 2010 to 0.29 percent in 2015.

Even if the reduction of Greek exports’ share could be interpreted as the outcome of the positive performance of other countries, this is no excuse for Greece; it actually illustrates that economies of a similar size and which are affected by similar problems, such as Portugal, ran faster and enhanced their competitiveness, making the most of their fiscal adjustment measures.

“The internal devaluation during the crisis has not averted a major decline in our exporting share, as there also are other factors besides the labor cost that affect the country’s exporting performance,” concludes a new report by the diaNEOsis think tank, which Kathimerini has seen.

The share of labor in the added value of manufacturing in Greece has been the smallest of all OECD member-states this decade, amounting to just 7.4 percent in 2010, and dropping further to 5.7 percent in 2015. The cost per labor unit went down much more than in other states, such as Portugal. The advantage Greek enterprises got from the reduction of the cost of labor has been offset to a great extent by factors such as the high cost of borrowing and energy.

According to Eurostat, the underlying tax rates in the use of energy, calculated in euros per oil ton equivalent, rose in Greece by 132 percent from 2009 to 2014 (from 153.5 euros/ton to 356 euros/ton), while in Spain the increase amounted to just 26 percent, in Italy it went up 46 percent and in Portugal it remained virtually unchanged. For the entire eurozone, the increase came to 18 percent, from 205.8 euros/ton to 243.4 euros/ton.

Source: Kathimerini