Athens back into recession, GDP in 2015 while braking. Salaries and pensions until July – Il Sole 24 Ore

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This article was published on February 12, 2016 at 14:35.
the last change is the 12 February 2016 at 18:54.

As widely expected because of the standoff last year elapsed between the first Tsipras government and the troika, Greece is back in recession in the fourth quarter, in fact, the Greek economy marks a new step (-0.6%) after -1.4% in the previous period; and technically two quarters of negative row signify its recession. Over the same period of 2015, the GDP recorded a 1.9 percent drop. An ominous sign for a country that has seen a reduction of 25% GDP since 2009 and whose government is now demanding a pension reform that would lead to a cut of 1.8 billion euro, equal to 1% of GDP. Still austerity, therefore, a blow is plunging Mediterranean country in deflation and recession abyss without yet having access to the Quantitative easing from the ECB because of capital controls still in place.

But not enough. Yesterday the head of the International Monetary Fund for Greece, Poul Thomsen, warned that without a realistic plan for debt sustainability, which runs at 180% of GDP, “soon the Grexit fears riaffacceranno”.

The country is in strong social tension because of the announced pension reform and increased taxation on the agricultural sector. Greek farmers are preparing a protest two days in the capital against the increase in the tax burden. At dawn this morning a group of farmers arrived in Athens with a ferry from the island of Crete and has been blocked by the police while trying to enter the Ministry of Agriculture in the center of the metropolis.

For more than two weeks, in addition, associations of farmers block highways and entrances to Bulgaria in protest.

Even firefighters, police officers, professionals, pharmacists are in revolt because of contribution increases and the reduction in the number of pension funds. The government Tsipras with only two majority MPs big risks in the legislative passage expected later this month. For now, however, there are no deadlines to pay up to July (€ 3.5 billion of maturing loans) and then Athens can continue to pay salaries and pensions.

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