(10 March 2016) – Boosting economic growth and investment to create jobs, improve the stability of public finances and provide an effective social safety net are crucial to help Greece recover from the profound social costs of the economic crisis, says the OECD in its latest report.
The Economic Survey of Greece says poverty has risen since the crisis to reach one third of the population. Tackling poverty and inequality must be urgent policy priorities, it adds.
The survey sees the recovery strengthening in 2017 as ongoing reforms and external demand benefit investment and jobs. It stresses that successful negotiations to address public debt sustainability are critical to improve the outlook.
However, major risks remain. Not only could the credit crunch continue to undermine domestic demand but weak activity could be compounded by a slowdown in global trade and softer growth in the rest of the Euro area, the destination of a third of Greek exports.
The survey adds that the refugee crisis could pose major problems for the Greek economy, particularly if the EU contribution turns out to be insufficient. Preliminary estimates put the cost of the influx of refugees at around 0.4% of GDP in 2015.