Greece: Greek Government plan to restart the economy through tourism

The second lockdown in Greece lasted much longer than the first. Also the cases and victims of the pandemic were much more than in March 2020 when the first cases were diagnosed in Greece and the first lockdown started. The aim is to speed up vaccination by receiving new doses of vaccines in May and June, which will allow the full opening of the economy. Now all ages from 30 years and over have the opportunity to be vaccinated and are expected to start vaccination ages 18-29. 

Since the beginning of 2021, it has been planned to open the economy with the opening of tourism, which is the strongest branch of Greece. The forecasts show revenues of 8 billion euros from tourism. 

In the general sector of the economy the Greek government has paid off its IMF loans early, helping to improve the country’s credit standing and saving on interest charges. So far, Greece has paid back 75%, or €6 billion, of the €8 billion in IMF loans received up through the summer of 2019. Re-upgrade by S&P with forecasts for recovery in 2021 4.9% and in 2022 5.8% helped the issuance of a new bond by the Greek state. Investors showed confidence in the Greek economy and thus raised 3 billion euros with an interest rate of 1.568%. 

In the area of taxation, the change of the tax rates of legal entities is implemented with their gradual reduction from 29% in 2018 to 26% in 2021 and 25% in 2022. There are thoughts of further reductions if high growth rates are achieved in the coming years. Also interesting is the alternative way of taxation for those who want to bring their tax residence in Greece. The government’s financial staff has designed a framework for the categories of taxable employees, retirees and investors with favorable tax rates if they declare a tax residence in Greece. The aim is to expand the tax base and increase government revenues. 

In the energy field, Greece is implementing its commitments to the EU to reduce carbon dioxide. Attracting investors in green energy is one of the government’s primary goals. The agreement of the company HELPE with the company Juwi for the construction of a photovoltaic park in western Macedonia is one of the largest projects that will be implemented. The goal is to reach 600 MW of energy production by 2025. This will replace the energy produced by the lignite plants that shut down. There are plans to create many small wind farms in the Aegean islands and Crete. Also important in the energy sector is the agreement between Greece, Cyprus and Israel on the creation of an underwater gas pipeline. All investment projects will support the labor market and create thousands of jobs. 

The next steps for restarting the economy are already always taken at the level allowed by the epidemiological data. All indications are that the pandemic will subside but will not disappear in 2021. However the vaccination campaign will help the global community return to more economic and social activities.