Wednesday, June 19 2024

Plan afoot for radical revamp of economy

As part of Prime Minister Kyriakos Mitsotakis’ plan for a radical overhaul of the Greek economy, the government intends to use the 32 billion euros in grants and loans that Greece expects to receive from the European Union recovery package proposed by the European Commission for large-scale investments in the green economy, infrastructure, the digitalization and modernization of public administration and training.


The Greek plan will be submitted to the EU in October.

Kathimerini understands that Mitsotakis is determined that the funds which essentially constitute another National Strategic Reference Framework (NSRF) program will not be wasted on benefits and the union demands of social groups and business sectors, but will rather be the vehicle for the real transformation of the Greek economy. 


Given the enormity of the projects these funds will allow, the focus has now shifted from speculation of early elections to a cabinet reshuffle in order to best implement the premier’s overhaul plan by the time it is submitted to the EU.

The drafting of the plan will not be done by the ministers – as they will undertake its implementation – but centrally by the Mitsotakis himself and his associates. At the same time, a committee of experts led by Cypriot Nobel Laureate economist Sir Christopher Pissarides is expected to have an advisory role.

Meanwhile, the most pressing issue for Mitsotakis at the moment is to further reduce employer contributions, as he announced last week in an interview on Star TV.

“The reduction is essentially in the indirect taxation of labor,” he said, adding that “this is a plan that we will be able to announce soon, at the end of summer.”  “I think it is the first priority today, because the burden on labor is very high and very burdensome for many companies,” he said. 

Kathimerini understands that while the reduction of contributions is already expected from June by 0.9%, the government plans to announce a further reduction in September of around ​​1% – probably 1.1%. 

The relevant announcement is currently being worked on and could be included in the presentation of the government’s guidelines for its economic policy by Mitsotakis in his speech at the Thessaloniki International Fair in September.