The BoG Monetary Policy Report was handed over to Konstantinos Tassoulas

The important role of the Bank of Greece, as “advisor to the Parliament, the Government and the Greek society in general on how we must meet the current challenges”, underlined the President of the Parliament receiving today the annual Monetary Policy Report of the Bank of Greece 2021-2022 by the Commander of Mrs. Ioannis Stournara.

In their statements, Messrs. Tassoulas and Stournaras stressed that it is a very important element for the prospects of the Greek Economy to soon acquire an investment grade.

The Speaker of the Parliament, thanking Mr. Stournaras for the information, noted that the Report will be thoroughly processed by the competent Parliamentary Committee on Economic Affairs.

The BoG Governor, presenting the Report, analyzed the economic situation, concluding that the news is positive, “we can see the glass half full, despite the unfavorable international news coming from the war in Ukraine”.

Commenting on the economic developments, the Speaker of the Parliament underlined that it is reasonably comforting and hopeful that “the Greek economy in all this turmoil has officially escaped from the enhanced supervision. by far the famous investment tier, which will pave the way for much cheaper borrowed money that our economy needs. ” He expressed his confidence that this Report will be studied and used properly in order to be another additional mechanism of contribution of the Bank of Greece in addressing the important challenges that our economy has in a positive direction.

Mr. Stournaras, noting that the reference of the Speaker of Parliament to the role of the Bank of Greece is very honorable, stated that the BoG stood up and performed its duty in the best possible way, while adding that for this Report directly or indirectly More than 200 people have worked, not only from the Studies Directorate but also from other departments.

The Governor of the Bank of Greece immediately proceeded with a comprehensive report on the situation and prospects of the Greek Economy, emphasizing:

“Greece is currently under the influence of positive and negative developments. The negative developments come from the war in Ukraine. Greece, like most European countries and EU member states, is a net importer of energy. This means Rising energy prices are creating a huge cost across Europe, reaching around 400 billion, a GDP of 10 trillion, which is quite a significant percentage. The normalization of Monetary Policy also means that the era of cheap money is coming to an end, we will have an increase in interest rates of the European Central Bank from July and this will continue until inflation normalizes. Of course, there is a counter-force, positive, which will exist if we soon acquire clothing level. This will do the opposite, ie it will reduce the cost of money. That is why the government has rightly set the achievement of the investment level as a national goal, something to which the Bank of Greece agrees and helps. So the positive news in the Greek economy, because, as I said, there are positive opposing forces to these negative ones that come from the war. These are, in principle, the very positive developments in travel receipts, in tourism. In the Report, the assumptions we make are that we will catch about 80-85% of the receipts of 2019. It seems that we will not just catch the targets but we will exceed them. This means that the forecasts we are talking about this year for GDP, which is 3.2% growth, may be conservative and exceed it. But let’s stay there. It is important that for the next three years, 2022-23-24, in the normal scenario, the Bank of Greece sees a GDP growth rate between 3% and 4%. This is very positive. Of course, it presupposes that the war will end in 2022 and energy prices will begin to de-escalate. But even in the unfavorable scenario in Greece, no recession is predicted in the next three years. For what reason; Not only from tourism. First, the accumulated savings from the pandemic and from state aid amount to 36 billion euros, the savings of the private sector is about 16% of GDP, when before the pandemic it was only 5%. So this is a cushion for consumer and investment spending in the coming years. Secondly, significant funds will flow into Greece in the next 7 years, over 70 billion, both from the new tool, the Recovery and Durability Fund, but also from the well-known NSRF. Third, the Public Debt, with the agreements of the previous years, has been regulated and has an average duration until its expiration, in 19 years, with a very low average service rate of 1.4% and is also held by official bodies. And this is something very, very positive. Also the banking system has been consolidated to a great extent. Of course, there are still steps to be taken to adequately finance the economy. However, all this, which is reflected in the upgrades that have been made by Credit Rating Houses in recent months, we are only one step away from the investment level. So the effort of all of us should be exactly how we will achieve this investment level, not so much for the benefit of the Greek State, because I explained to you that the Greek State has settled the debt with the previous agreements, but mainly of the banks and the private ones. business. “So we can see the glass half full despite the international unfavorable news coming from the war in Ukraine.”