By Tasos Dasopoulos
ELSTAT records a decrease of 2% of GDP in the primary deficit and by 3.8% of GDP in relation to the Budget forecasts for 2021 for the budget closure of the previous year as a result of over-performance of the economy.
Specifically, the primary deficit reached 5% of GDP compared to 7% of GDP projected based on the European Statistical Rule (ESA) as envisaged in the 2022 Budget voted last December. It should be noted that the comparison of the deficit announced by ELSTAT with the primary deficit based on enhanced supervision is not comparable due to different calculations of the figures that make up the final result. Compared to 2020 when the primary deficit reached 7.2% of GDP the 2021 deficit is recorded reduced by 2.2%.
The general government deficit, which includes interest payments on general government debt, is also significantly reduced to 7.4% of GDP from 9.6% of GDP projected in the 2022 budget.
The critical size of the debt for Greece is also recorded significantly reduced by 3.8% of GDP from 197.1% of GDP projected at 193.3% for the final closure of 2021. In fact with the announcement of ELSTAT for The result of 2021 shows that in one year the debt escalated by 13% of GDP compared to 2020 when the debt had reached 206.3% of GDP despite the continuation of the health crisis.
Regarding the return of the support provided by the state to the financial system in 2021, it is recorded negative by 213 million euros (corresponding to 0.12% of GDP) due to the additional guarantees given for the operation of the Hercules program.
For the year 2019, the support of financial institutions had a positive effect on the General Government balance. This is because the accrued fees arising from the interbank lending guarantees and the bond lending system, as well as the income from the banks’ preferred shares, were higher than the accrued expenses. In contrast, in 2018, 2020 and 2021 the cost of support was higher than the relative revenue.
Source: Capital
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