UBS: Greek growth at 5.6% this year, at 6% in 2022

UBS “sees” a strong recovery for Greece, arguing that the situation in the Greek economy will continue to improve.

The investment bank estimates that there will be strong strengthening of the domestic economy both this year and in 2022, moving well above the average level of estimates of international investment houses.

UBS, although it has reservations about the course of tourism, sees a growth rate of 5.6% this year, and 6% in 2022.

At the same time, it estimates that the domestic economy will exceed the Eurozone averages, where it expects growth of 4.3% and 5.3% in 2021 and 2022, respectively.

He estimates that unemployment will fall from 16.3% in 2020 to 15.7% in 2021, reaching 14.7% in 2022, but public debt will fall slightly from 207% of GDP in 2020 to 202% this year, declining in 2022 to 193% of GDP.

Optimism

The optimism also comes from the economic data of the first quarter which so far  show resilience to economic activity, with industrial production being stronger than in 2017, while positive signals are sent by the economic climate for March and from the course of tax revenue.

The primary deficit of 3.4 billion euros in the first quarter was better than the estimate of UBS by 0.9 billion euros, which reflects resilience in tax collection.

At the same time, UBS “sees” that the recovery will come for a number of reasons, such as the boost in consumer demand after the end of the restrictions, and the retail trade that has been open since mid-April. The utilization of European resources, the Recovery Fund expected at the end of July and finally the package of measures to support the economy, which amounts to 14 billion euros or 8.5% of GDP, complete the package.

At the same time, UBS records the reduction of the corporate tax rate from 24% to 22%, but maintains its reservations about the possible revenues from the tourism sector.