The fragile transition of the economy to the next day

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What the Greek market and economists are saying to “NEA” – Premiere of the lifting of the restrictive measures: when will the air transport return, what liquidity will be given by the banks and what can we expect from Community aid

Breaking the backbone of an economy is tantamount to breaking social welfare and, consequently, cohesion. In the new world map drawn up by the pandemic, the connection between economy and society must be the main material in the construction of the transitional “bridge” of the present with the new reality, as the current crisis hits Greece before even the black ink of the previous one dries. The new Armageddon recession is predicted to be more dangerous, due to the growing uncertainty posed by an ongoing health threat, and therefore the degree to which the political response is effective, especially across Europe, is a big bet. The shockwave is not stopped by the weapons of the recent past, with the business world and workers lamenting the fragile transition from normalcy to normalcy.

There is a fundamental question: How does an entrepreneur see the next day when the epidemic crisis breaks down demand and consumption, has “drugged” tourism / catering / entertainment, has “frozen” investment, and of course when thousands of jobs and incomes are threatened .

Economists and representatives of the Greek market speaking to “NEA” convey the great degree of uncertainty that accompanies the historical test, asking for additional measures that will focus on liquidity, VAT reduction, zero income tax advance and reorientation to production. They are very concerned about the tourism, catering and transportation sectors. Especially for air transport, domestic factors emphasize that it will take 2-3 years for the sector to return.

So far, Europe has received support decisions worth 540 billion euros, in the form of loans, which are considered insufficient, of which Greece can receive about 8-10 billion euros. In addition, according to sources, more than 10 billion euros can be given from the already existing Community financial instruments (NSRF, Investment Bank, etc.). In addition, factors in the banking market estimate that the new funding, potentially, could reach 12-15 billion euros.

Nikos Vettas

“The economy needs support but also new blood”

Even before the new crisis, it was clear that without substantial changes in the structure of our economy it would not be possible to develop as much as needed for fiscal stability, convergence in the European average and, ultimately, the well-being of its citizens.

The sectoral composition of production, the characteristics of enterprises and the role of the public sector contribute to low productivity and income. With the unexpected arrival of the new situation, the State is called upon to support, by increasing its borrowing, households so that there is no excessive reduction of their incomes and businesses in order to maintain their productive capacity.

So a crucial policy question arises. The support of those affected by the crisis is imperative. But if all the resources of the economy are tied to the previous production model, the next day will find it less competitive and even more charged. It can thus move towards dangerous paths, in just a short time. Therefore, the support of sectors should be done simultaneously with their productive upgrade and without stifling new dynamic sectors. Strengthening businesses with a significant contribution should not conflict with new business ventures. And the protection of workers must not leave the unemployed in the background and the creation of new work.

General Manager, Foundation for Economic & Industrial Research, Professor at the Athens University of Economics and Business

Michalis Masourakis

“The next day in the economy”

Sooner or later, the adventure of the corona will become a bad memory. The point is not to return to the normality of an economy, with constraints and distortions that have hampered entrepreneurship and investment.

Today’s state has succeeded in convincingly “costing” all Greeks the need to implement painful but necessary survival measures. The public administration was positively surprised, showing a new, dynamic face of operational competence.

The next day, the government and public administration are called upon to build a new economy that escapes development mediocrity, survives in the face of intense competition in the global economy, prepares for future technological developments and increases public sector productivity. Only in this way can the productive model of the economy be changed and the tax burden on businesses and labor reduced, without undermining the viability of our pension system and improving the health and education of the population. This is how society thrives. Reform measures are needed to reorient the economy towards production, private investment and exports, through increased business competitiveness. For jobs for all, competitive wages and decent levels of social protection. And a strong state, with resources capable of carrying out its task.

The chief economist of the Association of Businesses and Industries

Giannis Retsos

“Unity and realism are our weapons to overcome the crisis”

In the previous period, SETE’s effort to support Greek tourism took place in a realistic context, with close members of the Board, as well as our 13 pan-Hellenic member bodies, representing all sectors of the sector.

The coming months will highlight the real economic implications and determine the next bailout.

Priority, in the short term, is the management of the health issue. Everything will be judged from the first weeks of May, as the strict restrictive measures will be lifted and the first results will be seen. Prior to the resumption of operations of tourism companies, the priorities are summarized in the health rules of the market and in the support of labour with partial coverage of wage costs, at a time when businesses will operate with zero revenue. Additional measures should be considered that will focus on business liquidity and the competitiveness of the tourism product (liquidity tools, VAT reduction, zero income tax advance for 2020). Greek tourism has supported the country in the years of the financial crisis and in the face of the new challenge, united and more united than ever, we will try to cope and recover.

President of the Association of Greek Tourist Enterprises

George Karanikas

“Traders and Consumers Remain Safe Together”

Greek trade is entering a fragile transition period to normalcy. In order for the market to “reheat” quickly, traders and consumers need to feel safe, with clear and applicable rules for the protection of their health, which will allow customers to browse within stores, test products and trade in cash. . Owners, employees and customers in the small and medium-sized business are linked to long-term trusts, and this will ensure mutual respect and discipline in the guidelines for the protection of public health. The commercial world has consciously avoided maximalist claims to the state since the beginning of the pandemic. However, a marginal situation is emerging for the viability of thousands of SMEs and jobs. The government must strengthen liquidity measures for businesses and all self-employed people.

President of the Hellenic Confederation of Trade and Entrepreneurship

George Stasinos

“Tax incentives for the next day”

For the next period I have two suggestions:

First, for the next four months, any citizen who pays a lump sum tax and insurance liability that he has in settlement, is entitled to a 25% discount.

Secondly, whoever spends on an investment from 1/3/2020 and until 31/12/2021, is entitled to a coupon to offset tax liabilities, lasting seven years, with a value equal to 25% of the amount of money spent during this period, and not the total value of the investment. So, if someone has started an investment, it will speed up the process of spending, supporting work and the economy. Also, if someone is wary of investing, they will have a strong incentive. Finally, we will attract new foreign investors to a country that has recently proven to be reliable and serious.

President of the Technical Chamber of Greece

Apostolos Kapsalis

“Measures without workers’ consensus and protection”

There are two main characteristics of the measures taken in the field of labour relations. First, they are not a “new labour law” because the measures introduced by the PNP or even the JMC, as they are renamed, are nothing but updated versions of flexible forms of employment that existed before, but were strengthened during the Memorandum era. Secondly, they are deprived of social legitimacy, as they are not only introduced without collective bargaining at the sectoral or national level but also abolish consensus or consultation with the labour side, guarantees that accompany almost all of these regulations.

For these reasons and because they are being introduced into an already deregulated labour market when quarantine is lifted, they will provoke reactions from the world of wage labour, but also an escalation of undeclared and delinquent employment (and) for survival reasons.

Dr Labor Relations, INE / GSEE


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