The Central Bank lowers its estimates of Greek economic growth in 2022

[Reuters]

The Bank of Greece lowered its economic growth forecast to 3.8% this year from 4.8% earlier and raised its inflation rate forecast to 5.2% under the base scenario, in its annual report released Thursday.

The report, presented by bank governor Yannis Stournaras, also said that under the adverse scenario, Greek economic growth will slow to 2.8% and the inflation rate will increase to 7% this year.

Stournaras said Greece had a historic chance to turn the current crisis into an opportunity and underlined that the main objectives of economic policy in 2022 should be to preserve the momentum of economic growth and to continue efforts to achieve the credit rating. ‘investment.

Referring to uncertainties, Stournaras said that in the medium to long term, the biggest external risk was the climate crisis, and noted that the risk was significant for Greek banks.

Stournaras said that the Greek economy could ensure an average annual growth rate of 3% if certain decisions were taken such as the digitization of justice, the resolution of the problem of the accumulated debt of the private sector and the acceleration of privatizations. He added that it was also crucial to implement these decisions.

Stournaras said the Greek banking system has reduced its stock of non-performing loans to 12.8% of the total loan portfolio, but remains very high, compared to an EU average of 2.1%. He noted that 39% of NPLs were currently covered by special repayment programs, but a high percentage of loans had repayment delays. He urged banks to remain vigilant and step up their actions to reduce NPLs. [AMNA]

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