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Greek Parliament’s Budget Office sees higher primary surplus this year

Greek Parliament’s Budget Office sees higher primary surplus this year

The Greek economy remains on a positive course, the Parliament’s Budget Office said in a report on the Greek economy presented on Tuesday, but it warned of uncertainties related to pensions and to the course of the global economy.

“The Greek economy remains on a positive course, unemployment is falling, employment and wages rising, while based on current data the state budget’s primary surplus is up 1.0 billion euros compared with the same period last year,” it said.

“This development offers room for a significant social dividend at the end of the year,” added the report, warning however that “there are still some uncertainties related with the course of the global economy, trade tensios and Italy and rising fiscal pressures in the light of court decisions anulling implemented wage and pension measures.”

This year’s primary surplus would significantly exceed targets, reaching up to 4.5 pct of GDP (from a target of 3.5 pct), the report said, offering room for a high social dividend. It underlined, however, that court decisions on retrospective payment of pension cuts could lead to other court actions by other categories of workers or pensioners with a significant fiscal risk. This uncertainty could be intensified, since the Greek economy is entering a pre-election cycle with intensified political conflict, it said.

Head of the Parliament’s state budget office Frangiskos Koutentakis said that although he recognised the risks, he predicted it was unlikely to see a wave of state obligations capable of reversing fiscal goals.

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