Economy Forecast To Shrink 6.7% In 2012
2012-06-27 11:20:33
Greece’s economy will shrink by a further 6.7%, the Athens-based Center for Economic Planning and Research (KEPE) said in its quarterly report on Tuesday.
KEPE considers that the economy will start recovering in 2014, perhaps even in the last quarter of 2013, with the only positive contribution to gross domestic product made by a decline in imports.
It further argues that the attainment of the target of reducing public debt to 120% of GDP by 2020 depends on a number of key factors, mainly the growth rate, the achievement of primary surpluses and the country’s borrowing rates.
Regarding salary cuts, KEPE takes the view that it has to lead to a fall in prices but the main result will be the deregulation of the labor market, without any benefit for the economy as a whole.