Greece improved its public finances last year, achieving a general government primary surplus of 0.7 percent of gross domestic product compared to a 5.9 percent of GDP deficit in 2015, the country’s statistics agency ELSTAT said on Friday.
“The surplus of General Government for 2016, in accordance with ESA 2010, is estimated at 1.3 billion euro (0.7 % of Gross Domestic Product), while the gross consolidated General Government debt at year -end 2016 is estimated at a nominal value of 314.9billion euro (179.0% of Gross Domestic Product).”
Under ESA 2010 guidelines, the general government’s primary balance, excluding debt servicing, reached a surplus of 3.9 percent of economic output last year versus a downwardly revised 2.3 percent deficit in 2015.
ELSTAT did not calculate a figure for the primary budget balance under the country’s bailout program, where there is a different statistical treatment on some expenditure and revenue items.
Under the bailout program, Greece had a primary surplus target of 0.5 percent of GDP. Prime Minister Alexis Tsipras has said the country strongly outperformed, delivering a surplus of at least 3.5 percent of GDP.
ELSTAT also said Greece’s general government debt rose to 179 percent of GDP last year from 177.4 percent in 2015. [Reuters]
It is the 14th time, the data have received validation by the Eurostat,” ELSTAT president Thanos Thanopoulos said.
Elstat’s data have still to be confirmed by the Eurostat on April 24th.
The Primary Surplus of 3.9% is a powerful weapon in the hands of finance minister Euclid Tsakalotos who struggles to reach a compromise between the International Monetary Fund the Greece’s European lenders.
In a rare expression of …support for Greece, German Finance Minister Wolfgang Schaeuble urged the international Monetary Fund to “trust the Greek data”. While the IMF insists that primary surpluses of 3.5% are not achievable, Berlin insists that they are. Of course, nobody forgets that it was Schaeuble who enforced 3.5% targets when the Greek government had to sign the 3. bailout in summer 2015.
But how could such a high primary surplus be reached when Greeks try to spot “growth” with the help of field glasses and see nothing?
Harsh austerity measures was the success formula. A formula that translated into real life reads “over taxation.” And frugal state expenditure, which is felt especially in the public health sector.
Greeks paid 2.65 billion euros more in taxes in 2016.
PS Had Leonard Cohen be still among us he would write a song “Tax me to the end of time”.