In the 7-year horizon, until 2030, economists call the achievement of the goal of approaching 85% of GDP per capita in terms of purchasing power, where it was at the beginning of the crisis, in 2010, from 68%, i.e. in the worst position today after Bulgaria and Slovakia, in the EU They have the same prospect to cover the large investment deficit formed in memorable years, which is estimated at 100 billion euros.

However, there are conditions. The stability program presented by the government last week to the European Commission prescribes a virtuous horizon until 2026, during which the country will record fairly strong growth, led by investment, while being fiscally disciplined on primary surpluses, leading to to drastically reduce their public debt.

Programs are not always implemented literally, let alone when they are moving in a fairly optimistic direction, as in Greece, whose forecasts are better than in most other European countries. Greece, however, is “obliged” not only to succeed, but to exceed its targets in order to make up for lost ground in its credit crunch.

Fees and investment, analysts say, are linked. It may not be a hot topic of debate in the pre-election period, but in order to achieve the salary increase that the prime minister is talking about, as well as the corresponding goals of the opposition, increasing the country’s productive potential is a must. As Alfa-Bank said in its recent analysis in its weekly newsletter, given that the production deficit is now almost eliminated, bring Greece’s GDP per capita closer to that of the EU. it is necessary to expand the productive potential of the economy, by strengthening the country’s labor force and natural capital, as well as the productivity of these two factors.

The bank’s chief economist, Panagiotis Kapopoulos, believes that “by the end of this decade, we can approach the level of GDP per capita in terms of purchasing power, close to 85% -90%, that is, the level of the pre-Olympic Games period.” The prerequisite, however, is not only to increase, but also to improve the quality of investments, so that they are productive, as well as human resources through education and brain gain. Not all investments are productive, he comments, pointing to the large percentage of real estate in foreign direct investment.

Investments are needed to increase the production and export potential of the economy.

Fortunately, the Recovery Fund obliges the country to direct the bulk of its investments to productive sectors, the transition to green and digital technologies. “The Recovery Fund finances investments that the country really needs,” he comments. “These investments increase productivity and improve its natural capital.”

According to the Stability Program, Greece’s GDP in the next four years will grow faster than many other countries, leading to convergence, albeit at a slow pace. A rate of 2.3% is predicted this year, 3% in 2024, 3% in 2025 and 2.1% in 2026, while the corresponding rate, for example, For Germany, is predicted to be 0.2%, 1.8%, 09% and 0.9%, and for Portugal 1.8%, 2%, 2% and 1.9%.

The determining factor, according to the analysis of the Ministry of Finance, to achieve these indicators is investment. The stability program “foresees” investment growth of 13.2% this year, followed by 9.7% in 2024, 10.7% in 2025 and 7.2% in 2026. 8% is required until 2031 to close the investment deficit of the crisis. However, as Tasos Anastasatos, chief economist at the Delphi Forum, noted recently, increasing investment alone is not enough. “Disinvestment in 2009-2022,” he said, “has reduced the country’s capital stock by 101.4 billion euros. Foreign direct investment has increased significantly and reached $7.2 billion in 2022, however, a significant percentage comes from the acquisition of existing business units and portfolio investment. The investments that increase the production and export potential of the economy to the greatest extent in the long term include investments in the creation of a new production infrastructure (greenfield investments), both domestic and foreign. Attracting more such investment requires an ambitious and systematic implementation of structural reforms that improve the business environment.”

In the long term, there is another problem, demographic and population aging. According to a recent relevant report from the European Commission, the dependence rate of older people over 65 on workers will increase from 39.2% in 2021 to 46.1% in 2030 and reach 65.2% in 2070. This is also a key factor. that the projected growth rate, potential GDP, will decrease, according to the Stability Program, to 0.7% in 2030, and then increase in the range of 1.5-1.7% by 2060.