As Recession Deepens, Greece Seeks the “Big Foreign Investor” To Change the Negative Atmosphere

Posted by in Economy

Where is the Big Foreign Spender to invest in Greece and change the pessimistic and negative atmosphere? Where is the One who will let capital flow in the debt-ridden country and restore the image of bureaucratic and entrepreneurship-hindering Greece? Where is the foreign Goldfinger who will turn Greece into a trust-worthy country with one single touch? Government officials allegedly put their hopes into the hands and money of such rich and risky investor, while at the same time they admit, boosting growth and remove obstacles is a difficult, if not impossible task. Speaking under conditions of anonymity, of course.

 Additional Measures Trigger 1.5%-2.5% Recession

The recession is deepening at estimated levels close to 7%  in 2012 because of delays in growth measures, political instability and the international environment, according to reports from the Troika and the government.  From 2013 onwards, it is estimated that the austerity package of 11.5 billion euro will bring additional recession decline by about 1.5% to 2.5% per year, postponing the economic recovery for 2014 – so the most optimist scenario.

According to government officials, keys for markets and enterprises is that money from EU Structural Funds will be rapidly released in addition to moves that will change the atmosphere.

“The entrance of a big foreign investor can change the behavior of markets and help the country,” government officials report.

However, at present, everything is “under construction” so to say…

“According to information, predictions about recession speak of close to -7% for 2012. EU Commission estimations are in slightly lower levels, while the IMF is reportedly a little more pessimistic. Last spring recession was been estimated at -4.8%.

From 2013 onwards, the 11-billion euro spendining cuts package is expected to affect the recession by 1.5% to 2.5% annualy. So instead of ‘zero growth’ (estimation of last March) they now speak of more than -2%.

The recovery will come in 2014 according to the most optimistic scenario, which according to reports is been prepared by the European Commission. The IMF seems to be more pessimistic, “seeing” and negative growth also in 2014.

Interestingly, according to reports, the Troika incorporates in some scenarios, the extension of the implementation of Memorandum of Understanding for four years. In such case, the recovery will be faster but much smaller.

Without MoU extension, the Greek economy will suffer form recession for more years.

The government officials told that the key role hides in the economic atmosphere. IF it changes to the better and investors come, the grim estimations will remain on the papers.

However this is not easy at all. Then apart from the fears about the country’s economy, dozens of other obstacles around the Ministry of Development have to be overcome: prices, entrepreneurship, investment laws, EU Funds realisation. However Development Minister Kostis Chatzidakis recently made it clear that such a task is very difficult,” government officials said under conditions of anonymity.”

Beginning of month, Minister Hatzidakis revealed the government plan, a Ten-Points Reform  Program for money making through privatization and investment. Did he say “It’s a difficult task”? I think, I missed that specific point. Or it’s the usual underminers inside the government.

Urgent Advise: Until the Big Spender invests in this Cabaret-country, close the doors and throw the key away.

BTW:  How this big economic miracle of -10% recession in 2013 will mutate into growth and development with an unprecedented high jump in 2014 is something only Olympic Games trainers can scientifically explain.