Greece will negotiate fiscal targets with euro zone partners for 2021 onward, finance minister Christos Staikouras said on Tuesday. The coronavirus pandemic brought the Greek economy to a halt, therefore, Greece will be discussing new fiscal targets with his euro zone counterparts, Staikouras said speaking to CNBC network.
- The European Commission, the executive arm of the EU, forecast in May a debt-to-GDP ratio of 196.4% for Greece in 2020 and of 182.6% in 2021. In 2019, Greece’s debt pile stood at 176.6% of GDP.
“Taking into account what the Eurogroup (of euro zone finance ministers) decided recently, we don’t have these targets in 2020 and we will discuss as Europe, at the Eurogroup, the targets, the rules and the requirements for 2021 onwards taking into account the response to the coronavirus crisis,” Staikouras said.
In the wake of the pandemic, European policymakers agreed in March to lift fiscal targets for each member country, giving them more leeway to tackle the unprecedented economic shock. However, this is meant to be a temporary measure in response to the economic crisis across the European Union.
“According to the European Commission, we will not have the largest increase in debt-to-GDP in 2020, we will be the fourth-largest increase, but we will have the largest decrease of this ratio in 2021,” Staikouras told CNBC, saying that Greek debt is sustainable.
One of the main uncertainties for 2020 is the performance of the tourism industry.
“The percentage of this year, of 2020, economic decline depends to a great extent on the performance of tourism,” Staikouras said. [full story CNBC]
