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Greece emerges from the crisis in 2034

02 November 2015 / 19:11:57  GRReporter
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By 2020, the Greek economy would shrink by 0.8% each year and the unemployment rate would be very high. This optimistic scenario would take place in the absence of other shocks and if the country continued to be part of the Eurozone.

The information is part of the report for 2015 by the Swiss company Prognos AG, which addresses various issues related to what is happening in politics, economy and society and which is published by the German publication Die Welt.

The report's authors pay particular attention to the high percentage of Greek government debt. "From 2008 to the present day, the ratio of debt to gross domestic product has doubled and reached 200%. By 2022, it will reach 245%. If no real debt haircut were made, Greece would not be able to recover," states Michael Behmer, chief economist at Prognos AG.

Commenting on the social consequences of the crisis, he states that it would take another generation in order for Greece to find itself back in the position it was in before the start of the crisis. "After 2008, the country lost 1/3 of its economic power. Today, one in every four young people is registered in the labour office," he says.

Unlike the European Commission, which often forecasts a tangible improvement of the situation, the report states that Greece would be able to increase its GDP more than 2% and to follow a certain path of development only in 2020. Experts expect that it would be able to return to pre-crisis levels in 2034 but that it would take 25 years for the unemployment rate to decrease to 10%.

At the end of the report, Behmer recognizes that, in the case of Greece, estimates contain a very high percentage of uncertainty.

Tags: EconomicsGreeceForecastHigh unemploymentRecessionDebtPrognos AG
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