The much anticipated EUROSTAT data on EU’s government deficit and debt has been released. According to the data, Greece’s primary surplus for 2015 was 0.7% of the GDP.
The Greek debt is 176.9% of the GDP and not 200% as it was claimed by several analysts last summer. In 2014, the debt was 184% of the GDP.
With reference to the total GDP, debt fell from €177.559 billion in 2014 to €176.023 billion due to recession and deflation.
The EURSTAT data has been anticipated by the Greek government that struggles to conclude the Review Talks with its lenders, while the IMF and the European creditors are divided.
Not only Greeks, but also the President of the European Commission Jean-Claude Juncker said that the positive outcome of 2015 will influence the International Monetary Fund to ask less contingency measures for 2018, in case Greece will not meet the targets by 2018.
The IMF wants contingency measures of 3-3.5 billion euro, thus raising the total amount of austerity measures to 8.4 – 8.9 billion whereas the 5.4 billion are the European lenders’ terms for the 3. bailout of summer 2015.
The IMF’s projection for 2015 was Primary Deficit 0.6% of GDP.
The gap between IMF’s Primary deficit and Eurostat’s primary surplus is some 2.3 billion euro.
Psychologically for Greeks, it is THE WORLD!
Right after the EUROSTAT release, Greek government sources told media, that “this result is a powerful bargaining card in the hands of the government amid the discussion for the Greek program Review” and that “it demonstrates for one more time, how wrong the IMF’s calculations are with the IMF to have forecast a deficit of 0.6% of GDP for 2015.”
EUROSTAT source here.
Of course, one has to ask how real is the Primary Surplus as the Greek state does not pay its private suppliers. However, apart from 2- maximal 3 billion euro given to Greek government in early autumn of 2015, the lenders do not pour money to Greece since summer 2014.
Another question is whether the IMF will accept the Eurostat data. Yes, the same IMF that makes its projections on wrong calculations. To quote Christine Lagarde last week: “there have been mistakes with fiscal multipliers”