helping Greek companies regain access to the finance they need to grow their businesses
promoting regional economic integration by bringing private sector knowledge and finance to such areas as the energy sector and infrastructure
The EBRD will be investing in Greece on a temporary basis in response to a request from the Greek authorities to support reforms and a return to economic growth.
The EBRD’s shareholders have voted for the Bank to invest in Greece until the end of 2020.
Our investments – backed by donor-funded technical assistance and policy dialogue -are intended to strengthen progress in the reform of Greece’s economy and contribute to its recovery. The EBRD will deploy its experience and expertise in attracting and encouraging foreign and domestic investment, strengthening the role of the private sector and deepening regional integration.
Specifically, we will help address the issue of insufficient capital for Greek private companies, especially small and medium-sized enterprises. This is a key barrier to growth, where the EBRD can contribute significantly with itscommercial debt and equity products and its risk-taking capacity.
The EBRD will also engage, where possible, in expanding the private sector’s role in infrastructure and energy. Greece is a natural trade and investment partner for many countries in south-eastern Europe where the EBRD has a strong presence. The Bank will support investments and policy measures which are conducive to integration.
Greece is a founding member of the EBRD and to date Greek companies and banks have invested €2.3 billion in the EBRD’s existing countries of operations, with a focus on south-eastern Europe. Under the Vienna Initiative, the EBRD supported the subsidiaries of Greek banks in the region at the height of the global financial crisis.
The Government of Greece requested that the country be granted recipient country status at the EBRD in a letter dated 25 November 2014, which said EBRD engagement would ”provide value added in tackling the consequences of the financial and economic crisis and addressing the structural challenges in the Greek economy that it exposed”.
The request was reconfirmed by the new Government on 2 February 2015. The EBRD will now engage with the authorities to prepare a Country Strategy for Greece which will provide the framework for its engagement and identify priorities. The EBRD also intends to open an office in Athens.
As well as being a country where the EBRD invests, Greece is also an EBRD donor. It contributes to, and actively participates in, the Western Balkans Investment Framework (WBIF). The country contributed €500,000 to the WBIF through the European-Western Balkans Joint Fund in 2011. In 2013 it hosted the WBIF Steering Committee in Athens.
The EBRD’s Greece strategy was adopted on 22 June 2016
Current EBRD forecast for Greece Real GDP Growth in 2018: 2.22%
Current EBRD forecast for Greece Real GDP Growth in 2019: 2.3%
After two years of marginally negative growth, the Greek economy grew by 1.4 per cent in 2017. Growth was partly driven by investment, with gross fixed capital formation contributing 1.1 percentage points to overall growth. Exports also performed well (an increase of 6.8 per cent compared to 2016 in real terms) although the higher rate of imports increase meant that net exports had a small drag on growth. Business confidence has risen steadily, with the purchasing managers index (PMI) reaching a level in February 2018 not seen since June 2000, but consumer confidence has plateaued in recent months after rising steadily in 2017. Growth last year was also supported by another excellent tourism season, including a 10.8 per cent increase in travel receipts (which, at € 14.6 billion, account for 8 per cent of GDP). Employment has also been on an increasing trend and the (seasonally adjusted) unemployment rate in January 2018 was 20.6 per cent, down from 23.2 per cent in January 2017. Looking ahead, we expect the improving trends in investment, employment
and confidence to continue through 2018 and 2019, leading to further growth of 2.2 per cent in 2018 and 2.3 per cent in 2019. However, the downside risks remain significant amid uncertainty about the post-programme framework and reform programme and Greece’s long-term debt sustainability.