The Hellenic Fiscal Council’s Spring Report, published on Thursday, refers to structural imbalances that continue to persist, despite progress in key macroeconomic indicators.

The report specifically mentions large current account deficits, low productivity and low savings rates, which translate into dependence on external borrowing and transfer payments. The council forecasts growth of 2.3% this year, as do the government, the Bank of Greece and the European Commission.

The report notes, however, that although GDP now exceeds the 2019 level, economic activity lags pre-financial crisis levels: “Despite the significant progress and steady growth in recent years, the restoration of GDP to pre-crisis levels has not yet been achieved, reflecting the broader structural problems that the Greek economy continues to face, after a decade of recession and adjustment,” the report notes.

This problem is confirmed by the data on labor productivity per hour worked, which is at 55% of the eurozone’s. This highlights the need for policies that enhance productivity (such as investment in education targeting digital skills, technology and innovation) and infrastructure, for sustainable growth, which is necessary not only to improve living standards but also to finance social policies, and the gradual decline of debt.

The report also notes that the high public debt, although decreasing, requires continued fiscal discipline, and that despite dropping, unemployment and inflation remain at levels higher than the European average. It adds that tackling structural challenges such as an aging population, low savings and productivity, and current account deficits, is crucial.

The council cites EU data on real wages, according to which, despite the recent increase, the average net monthly wage, adjusted for the cost of living, is still significantly lower in Greece than in most EU countries. “A further increase in wages,” it points out, “would be beneficial at the microeconomic level, but also useful at the macroeconomic level by stimulating aggregate demand, to the extent that it is accompanied by growth and improved productivity.”

Regarding fiscal developments, the council forecasts that the primary surplus will be maintained at 3.2% of GDP, while there will be a marginal surplus of 0.1% of GDP in the general government balance.



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