Řecko
Cradle of Western civilization with stunning landscapes and impressive cultural heritage
Total area: 131,957 sq km
Population: 10.5 million
Government type: Parliamentary republic
Administrative division: 7 decentralized administrations, 13 regions and 325 municipalities
Capital + other major cities: Athens (643,000) + Thessaloniki (309,000), Patras (170,000), Piraeus (168,000), Heraklion (149,000)
Currency: Euro (since 1 January 2002)
Languages: Greek
Ethnicity: Greek 91.6%, Albanian 4.4%, other 4%
Religion: Greek Orthodox 81-90%, Muslim 2%, other 3%, none 4-15%, unspecified 1% (2015 est.)
President: (Ms.) Ekaterini SAKELLAROPOULOU (since 13 March 2020)
Prime Minister: (Mr.) Kyriakos MITSOTAKIS (since 2019)
Date of EU accession:1 January 1981
KEY FEATURES
- Adopted the euro in the first wave
- Sharp FDI increase in recent years
- Combination of an inexpensive but well-educated workforce
- A maritime giant – the Greek Merchant Marine is the largest in the world
- Producer and exporter of high-quality jewelry
- The largest cotton producer in Europe (80% of production)
MACROECONOMIC OVERVIEW
Greece experienced a massive impact of the 2009 financial crisis which resulted in the government-debt crisis and a deep depression between 2011 and 2018. The economy contracted by 25% and the country was forced to seek bailout loans from international organizations such as the International Monetary Fund, the EU, and the European Central Bank. The country had to follow the rules set by international creditors which consisted of strict economic measures and structural reforms. During this difficult period, wages fell by more than a third, the unemployment rate skyrocketed up to 27.8% (2014) and an estimated 500,000 mainly young people left the country.
The economy rebounded in 2021 growing by 8.4% and putting the country back on track. Although the ratio of public debt to GDP remains high at 171.3%, rating agencies have recently upgraded the country’s rating (e.g. BBB- by Standard & Poor’s) having confidence in the fiscal responsibility and predicting further reductions in the public debt ratio. The unemployment rate has dropped to a feasible 12.5%.
The current government has successfully tackled the energy crisis and high inflation and continues its fiscal and reform program aimed at improving the business environment and increasing international competitiveness. The increase in FDI by 48.2% in 2022 confirms the country’s renewed attractiveness to investors.
Selected economic indicators, Greece, 2016 - 2022
| 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | ||
| GDP |
|
|
|
|
|
|
|
|
| Real GDP growth |
%
|
-0.5 | 1.1 | 1.7 | 1.9 | -9.3 | 8.4p | 5.6p |
| GDP at current prices |
€ bn
|
174.5 | 176.9 | 179.5 | 183.3 | 165 | 181.5 | 206.6 |
| Foreign trade |
|
|
|
|
|
|
|
|
| Exports |
€ bn
|
54.5 | 61.9 | 70 | 73.5 | 52.9 | 74.3 | 101.5 |
| Imports |
€ bn
|
57.1 | 64.6 | 73.9 | 76.5 | 65.6 | 88.4 | 121.6 |
| Balance |
€ bn
|
-2.5 | -2.6 | -3.8 | -3 | -12.7 | -14.1 | -20.1 |
| Prices |
|
|
|
|
|
|
|
|
| CPI – average inflation rate |
%
|
0.0 | 1.1 | 0.8 | 0.5 | -1.3 | 0.6 | 9.3 |
| PPI – industry – average |
%
|
-5.4 | 4.2 | 3.2 | 0.7 | -4.6 | 11.9 | 33.5 |
| Employment |
|
|
|
|
|
|
|
|
| Registered unemployment |
%
|
23.9 | 21.8 | 19.7 | 17.9 | 17.6 | 14.7 | 12.5 |
| Average monthly gross wage |
€
|
1,384 | 1,398 | 1,335 | 1,338 | 1,331 | 1,340 | 1,347 |
Source: IMF, Eurostat, OECD, World Bank, UNECE, 2016-2022
KEY SECTORS
Greece is not a country with such a strong industrial base. Its economy relies mainly on two pillars of tourism and shipping, and additionally also on the food sector. The manufacturing sector contributes only about 9% to the GDP, in contrast to the service sector, which plays an important role, accounting for 77.2% of GDP.
Apart from the country’s leading industries mentioned above, other sectors such as metallurgy, petrochemicals as well as chemicals, pharmaceuticals, and textiles complete the overall economic picture.
Tourism
One of Greece's main economic drivers is tourism which directly or indirectly accounts for 25% of the country’s GDP and employs a similar percentage of the workforce. The country attracts millions of visitors each year thanks to its historical sites, islands, and beaches. Tourist inflows were negatively affected by the Covid pandemic, but since 2022 the numbers have been returning to previous levels, rising to 30 million visitors a year. It is the 9th most visited country in the world and 7th in Europe.
Shipping industry
The Greek shipping industry contributes significantly to the country's exports and the country boasts one of the largest merchant fleets in the world, consisting of 5,520 ships, whose deadweight tonnage (DWT) represents approximately 21% of the world's capacity. Most Greek shipping companies have been family-owned for many decades. Shipping contributes approximately 7% to the country's GDP and the sector is booming, having grown by 50% in the last decade. Greek companies are involved in the production and supply of various maritime equipment, including components for ships, navigation systems, marine electronics, and specialized machinery used in the shipping industry.
To maintain its leading position, Greek shipping will have to adapt to new changes in the sector, such as digitalization, new technologies, and the requirements for sustainability and carbon reduction in shipping.
Agriculture & Food industry
Agriculture holds significance in Greece's economy, although its direct contribution to the country's GDP (3-4%) is lower than in other sectors. Greece is known for producing high-quality agricultural products, such as olives for olive oil, grapes for wine, citrus fruits, dairy products like feta cheese, and various vegetables and grains. Greek agriculture comprises approximately 700,000 farms with an average size of 7 ha. It is an important export sector with a strong presence in the European and US markets.
EXPORT & IMPORT
Greece’s involvement in international trade, as reflected in its export/GDP ratio, has increased significantly from 25.5% in 2011 to 49.1% in 2022.
The share of EU-related exports or imports remains relatively low (53.8% and 51.6% respectively) which can be partly attributed to the country’s geographical location. The leading export products to the EU include petroleum products (25%), followed by aluminum, pharmaceuticals, and electrical machinery. The EU is the main direct investor in the country.
2022 export and import data:
Main import partners:
Russian Federation – 10%
Germany – 8.9%
China – 8.5%
Iraq – 7.3%
Italy – 6.3%
Main export partners:
Italy – 10.4%
Bulgaria – 7.7%
Germany – 6.3%
Cyprus – 5.5%
Türkiye – 4.6%
USA – 4.1%
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