Greek economy shows resilience in first quarter amid pandemic

A man wearing a protective face mask makes his way on Omonia square in Athens
FILE PHOTO: A man wearing a protective face mask makes his way on Omonia square in Athens, Greece, September 3, 2020. REUTERS/Alkis Konstantinidis

June 4, 2021

By George Georgiopoulos

ATHENS (Reuters) – Greece’s economy expanded in January-to-March 2020 at a faster pace compared to last year’s fourth quarter, helped by investments, the country’s statistics service (ELSTAT) said on Friday.

Seasonally adjusted data showed gross domestic product grew 4.4% from an upwardly revised 3.4% growth rate in the fourth quarter of 2020.

The data showed the economy shrank at an annual 2.3% clip in the first quarter, at a slower pace from a downwardly revised 6.9% decline in the previous quarter.

“Looking at quarterly data, the impact of the pandemic continued to subside with the economy on an expansion track for the third consecutive quarter,” said National Bank’s senior economist Nikos Magginas.

Investments were the main driver behind the economy’s performance in this year’s first quarter with net exports continuing to weigh, he said.

The government’s official projection is for a 3.6% rebound this year after last year’s 8.2% economic slump. The European Commission’s projection in February sees Greece’s economy growing by 3.5% this year.

“Despite the high cost it incurred to confront the health crisis, the Greek economy showed endurance, stamina,” Finance Minister Christos Staikouras said in a statement.

Earlier this week International Monetary Fund officials said the economy should grow by 3.3% this year and 5.4% in 2022, fuelled by European recovery fund investment, pent-up consumer demand and an expected return of tourism.

“Based on the first quarter’s performance we see upside risks, the economy is likely to rebound by more than 4.7% on an annual basis, particularly if there is a positive contribution from the external sector, mainly tourism,” Magginas said.

(Reporting by George Georgiopoulos, additional reporting by Lefteris Papadimas; Editing by Ros Russell)