Privatisations boosted Greek GDP by 1.0 billion euros annually in 2011-2019, IOBE reports

Privatisations boosted the country’s GDP by around 1.0 billion euros annually, on average, in the period 2011-2019, while the average impact on the labour market reached 20,000 full-time jobs, the Foundation for Economic and Industrial Research (IOBE) said in a survey released on Wednesday.

The survey said that around 5.6 billion euros in fixed investments made in the country in the period from 2011 until the second quarter of 2019 could be attributed to a privatisation programme, which means that every 1.0 euro of initial revenue from privatisations represented an average of 1.02 euro of fixed investments in the economy. The survey also noted that the impact from privatisations was not limited to the time period of each transaction, but extended into the future, significantly supporting economic activity. This development is attributed to the fact that new managers of state assets make significant investments, change the business model, often adopting systems of environmental monitoring.

The report made specific mention of completed privatisations, such as that of the Piraeus Port Authority, which has led to a spectacular increase in container transport volume and established the port as the fourth largest in Europe (from 17th in 2007) and the top in the Mediterranean. The financial impact of this privatisation on the country’s annual GDP is expected to reach 375 million euros in a period of 10 years, IOBE said, adding that on employment terms it is expected to reach 5,500 job positions.

The concession of 14 regional airports to Fraport Greece will bring investments of more than 463 million euros by the end of 2020 and the financial impact on GDP will reach 630 million euros annually. In terms of employment, the impact will reach 11,600 job positions.

For the privatisation of the Astir Palace Vouliagmeni Hotel, the impact on GDP will reach 107 million euros, while in the case of TrainOSE and Rosco, the privatisations are expected to lead to an increase of operating revenue by 27 pct.