Chr. Staikouras: Greece is no longer an exception in the Eurozone

Greece is no longer an exception in the Eurozone, underlined the Minister of Finance, Christos Staikouras, speaking today at the conference of the Hellenic Capital Market Commission “The future of Sustainable Financing”

As he noted, “this is reflected in the historic decision of the Eurogroup in Luxembourg for the exit of Greece from the Enhanced Surveillance regime and its return – after 12 years – to European normalcy.”

It is also reflected in “the 12 upgrades of the creditworthiness of the Greek economy in the last 3 years, which bring it just a” step “before the investment stage. which is set for 2023, and which is expected to be achieved.

It is recorded at the same time in key indicators of the economy. With the most basic of these, GDP, continues to grow at high rates, amounting to 7% on an annual basis in the first quarter of 2022, significantly higher than the European average, climbing to a decade high, in terms of volume.

At the same time, the composition of GDP is improving, as much of this growth is based on significant boosting investment and exports.

In fact, the European Commission predicts that the Greek economy will grow strongly and sustainably in both 2022 and 2023, with Greece “champion” in Europe, for the next two years, in investment and exports.

“The above achievements and the positive prospects that they have formed are a result of the development strategy that we have set as a country, the main pillar of which is the promotion of ‘sustainability and sustainable development’, both in the business and in the financial environment,” he said. the Minister of Finance.

Mr. Staikouras also referred to the actions and interventions of the Ministry of Finance towards the creation of a new model of sustainable financing and green development, noting the following:

1st In the field of the domestic capital market, a series of targeted reforms and actions have taken place in recent times, with the ultimate goal of upgrading, modernizing and shaping its regulatory framework, so that it responds effectively to new market conditions and requirements.

A. We have reformed, strengthened and modernized the corporate governance framework of listed companies, by legislating a framework that, among other things, aims to enhance transparency and sustainable corporate growth.

B. We legislated the modernization of the operating framework of the Hellenic Capital Market Commission, as well as its organizational restructuring.

At the same time, a project of digital reform of the Hellenic Capital Market Commission has been launched, with a time horizon of the year 2025, and with financing from the resources of the Recovery Fund. A project that will actively contribute to the effective operation of the Supervisory Authority.

C. We are preparing a strategy for the development of the Greek Capital Market. We received technical assistance from the European Commission for the formulation of a “Strategy for the Development of the Greek Capital Market”, with the aim of promoting targeted actions and legislative initiatives for the substantial upgrade and modernization of the domestic Capital Market.

This project is structured in four axes:
-Upgrading the Greek capital market to a developed market.
Strengthening supervision in the capital market.
– Optimal ways to motivate the demand and supply of products in the Greek capital market.
Enhancing the use of financial technology (Fintech) and sustainable financing instruments.

D. We are launching a technical assistance project from the European Commission for the preparation of a “National Strategy for Sustainable Financing” through the design of appropriate funding tools to fill the funding gap towards the green transition.

E. We plan to issue a government green bond within 2022, provided the appropriate financial conditions exist.

F. We have set up a working group at the Ministry of Finance on sustainable financing and the green economic transition.

The task of the working group is to formulate strategic directions and to draw up a roadmap for the effective integration of the sustainability dimension into economic policy and the financial system.

In this context, the Working Group will proceed in the coming months to prepare strategic directions, with the aim of:
-The promotion of appropriate sustainable financial tools and economic policies for the green transition of the real economy, with particular reference to small and medium enterprises.

-The effective contribution of the fiscal policy and the publishing strategy of the Greek State, in order to achieve the further mobilization of resources for the green transition, while ensuring social cohesion.

-The assurance that the green economic transition of the country will be a lever of growth and extroversion, as well as a tool to strengthen the resilience of the Greek economy.

2nd. In the financial sector, a significant improvement has been achieved in its fundamental figures, especially with regard to the management of banks’ assets and liabilities, so that the banks can act as a belt for the transmission of liquidity to the Greek economy, which will come from the resources of the Recovery Fund. to finance sustainable investments.

A. In the assets of credit institutions, the amount of “red” loans decreased significantly.

In particular, total non-performing exposures were € 75 billion in June 2019, with the non-performing exposures ratio standing at 43.6% of total loans.

In March 2022, “red” loans stood at 17.7 billion euros, and the index at 12.1%.

B. In the liabilities – now – of credit institutions, liquidity has improved significantly.

Indicatively, corporate and household deposits increased by about 42 billion euros between June 2019 and April 2022, and amounted to 178 billion euros, which is the highest record since the beginning of the crisis in 2010.

Through the consolidation of their balance sheets, the banking institutions acquire an active role in managing the inputs of the Recovery Fund and the financing of sustainable investment projects.

C. Regarding the strengthening of liquidity in the real economy through the funds of the Recovery Fund, it is important to mention that our national Recovery and Sustainability Plan “Greece 2.0”, was designed and implemented in harmony with the UN Agenda 2030. ., aiming at the emergence of a new model for the country.

A model that will lead to strong recovery and sustainable economic growth, without exclusions, through reforms and investments that promote the green economy, innovation and digital transformation, the strengthening of social solidarity and justice.

In this direction, the investments of “Greece 2.0” are focused on the green and digital transition, since 37% of their expenses are related to the climate and 20% to the promotion of the digital transition of private companies.

In this context:

1st € 12.7 billion from the Recovery Fund goes to businesses to finance eligible business plans and investments, in the form of bank lending, in sectors linked, inter alia, to “green and sustainable” growth.

2nd. Over 10 billion euros is, so far, the total budget of the projects that have been included in the Recovery Fund, including the private investments that belong, among others, to the pillar of the “green transition”.