Greece’s economy has shrunk by almost 24 per cent over the past six years in the deepest and most protracted peacetime recession in its history, according to revised gross domestic product data.
Greek GDP shrank 3.9 per cent in 2013, from an estimate of 3.7 per cent in February, statistics service ELSTAT said.
Exacerbated by the austerity policies imposed by international lenders who bailed Greece out, the recession's main driver since the financial crisis hit in 2008 has been a 26-per cent slump of household consumption, as record unemployment and wage cuts slashed family disposable incomes.
Greece also saw investment collapse by almost two-thirds over the same period as home-building activity virtually ground to a halt, the figures showed.
With households and companies cutting spending and investment, imports of consumer goods and equipment sank last year to almost half their level in 2008.
Tourism, one of the country’s biggest foreign-currency earners, soared last year but did relatively little to lift the economy.
Exports of goods and services rose by 1.8 per cent in 2013 but were still 15 per cent below pre-crisis levels, as frail European economies failed to absorb more Greek goods, mostly agricultural products and raw materials.
The recession, however, does seems to be bottoming out as confidence in the economy slowly returns after Athens has avoided chaotic default and an exit from the euro zone.
Most international organisations and the government expect the economy to modestly recover this year, rising 0.6 per ent on the back of a rebound in investment and exports.
Greece’s economic sentiment index rose in February to its highest level in more than five years, the Athens Stock Exchange is at a 2.5-year high and 10-year government bond yields have dropped below 7 per cent, their lowest level since the country’s €237 billion bailout started in 2010.
Optimism is also fuelled by signs that the government is improving its fiscal management.
The central government reported a primary surplus of €2.1 billion in the first two months of the year.
Reuters
