Greek economy takes new blow, in the red in 2016

ATHENS: Debt-laden Greece’s economy suffered a new blow, contracting by 1.2% at the end of 2016, according to revised figures released Monday, meaning it remained in recession for the eighth straight year.

The figure by the national statistics agency Elstat compared with an earlier estimate of a seasonally adjusted 0.4% drop in the final three months of 2016 against the previous quarter.

It was the worst quarter since the height of the country’s financial woes in latter half of 2015 when Greece came close to default and appeared to be on the verge of being kicked out of the eurozone. 

The revised figures mean that Greece’s economy remained in recession for the eighth straight year, with GDP contracting by 0.05% in 2016 according to calculations made by Greek media.

The Elstat agency also said GDP fell by 1.1% in the fourth quarter in 2016 against the same quarter in 2015.

The new figures come at a time when Athens is locked in crucial bailout talks with the IMF and the European Union for its crisis-battered economy.

Following a long standoff between the EU and the International Monetary Fund over debt relief and budget targets, talks between Greek officials and representatives from its creditors aimed at freeing up fresh funds resumed in Athens last week.

The Washington-based lender believes demands on Greece sought by the Europeans are too ambitious.

But if the eurozone is going to stick with its plans, then the IMF wants the necessary tax hikes and pension cuts to meet them implemented before it will lend further to Athens. - AFP