If someone reads the reports of foreign rating agencies about Greece, he will have the feeling that the economy is soaring and that Greek households are fully content – in contrast to those of Germany, France, and Italy, which are suffering.
In response to a question raised by Naftemporiki.gr, UBS said on Thursday, during a webinar, that in an environment of sluggish European growth, the Greek economy “has its own dynamics” thanks to the generous resources of the Recovery Fund and another important asset: it primarily exports services (i.e. tourism) and not products.
But why do the rating agencies see success stories and miracles in Greece? Because they measure very specific indicators: GDP growth rate, inflation, public debt, fiscal deficit and primary result.
These indicators tell the story of a Greece that is growing much faster than the big three in the Eurozone (which is partly due to the fact that its GDP had sunk during the decade of the crisis and therefore had room for leaps), that is leading the way in reducing debt (although this is still by far the highest) and that is showing primary surpluses – higher even than what it has promised.
This last development is considered rather positive for the rating agencies. For ordinary households, however, this is not the case. Because higher tax revenues and primary surpluses come mainly from two taxes: VAT and ENFIA – both of which disproportionately burden the middle class.
