Total reboot: How to fix Greece's economy - U.S. News & World Report

posted on 05 Aug 2015 18:06 by giantowner1910
After months associated with high-stakes talks raised fears Greece may well fall out in the euro, the particular economy went straight into reverse: rather than grow this year, it is anticipated in order to contract in between 2 and also 4 percent.


ATHENS, Greece (AP) -- after so much pain, Greece must now figure out how you can acquire its economy back again about its feet.

The first, most significant step can be making sure the nation includes a steady government that is dedicated in order to avoiding a new disastrous exit from your euro.


Tourism, that creates virtually one fourth involving Greek economic output alongside store trade, nevertheless could probably be improved further.

Agriculture this past year contributed virtually six billion euros for the country's 179 billion euro economy but sometimes yield much more with some simple modernization along with better marketing.


It could, pertaining to example, extend the actual tourism period straight into winter by simply developing a lot more golfing programs -- a reasonable move in the nation blessed using a lot sunshine.

Though the actual number of visitors this coming year is forecast for you to hover around last year's, experts say the country could find ways to improve revenue.

Because a lot uncertainty remains, economists say Greece ought to focus within the short term upon making specific investments in industries it already features a presence in.

Have a new steady government along with purchase established sectors just like tourism and also agriculture. Although Greece will end up being the third largest extra virgin olive oil producer within the world, it exported 60 percent of its output in order to Italy throughout bulk, providing its neighbor the opportunity earn 50 % more around the cost of the ultimate packaged product, in accordance with the 2012 record by simply consulting firm McKinsey & Company.

Turning Greece's main ports involving Piraeus and Thessaloniki in to regional cruiseship hubs ought in order to be an additional crucial goal for that tourism sector, mentioned Christos Agiakloglou, professor involving economics from Piraeus University.

Investment within Greece a yr ago within everything coming from roads to become able to new offices equaled just 12 percent associated with economic output, largely any symptom of a lack of confidence within the country's stability. This found power within January vowing to always be able to undo the series of laws and also to challenge creditors. Merely 3 of 124 countries ranked through the world Bank invested any lower share.

It defintely won't be easy, nevertheless Greece offers no choice if desires to ease its people's economic misery.

Investors brought out tens of vast quantities of euros from the country and in addition the banks had to become shut in order to avoid their particular collapse. "You hold the groundwork already laid out along with there isn't any need for big investment," mentioned Panayotis Alexakis, professor regarding economics in the National & Kapodestrian University Or College associated with Athens.

Take olive oil. Government cuts necessary to be entitled to a a manufacturer new bailout will hurt incomes for many years to come.


The fishing business is an additional sector which Greece could develop quickly and also enjoys a powerful competitive advantage in, given its large shorelines.

The outlook for political stability isn't especially good. The Particular hope is the government in which emerges via individuals elections will show a lot more stable.

The advice in order to Greece coming from economists will be simple: start with just about all the basics.. Within the particular longer-term, tackle the more difficult nevertheless fundamental problems such as tax avoidance, higher public financial debt and complex enterprise laws.

Investors want to know Greece won't belong to yet another crisis over regardless of whether to go away the actual euro -- which may trigger massive disruption towards the economy -- along with in which the principles associated with carrying out business won't alter unexpectedly.


The scale with the country's monetary problems can be mind boggling -- a complete quarter with the economy evaporated in the past six years and also enterprise exercise is now plummeting further. Political parties, including the particular ruling Syriza, are in turmoil there will be speculation Greece will head in to another general election inside November. Boundaries in money withdrawals are generally costing Greece an estimated 1.75 billion euros to 2.8 billion euros ($1.9 billion for you to $3.1 billion) weekly.

Greece's existing government provides the starkest illustration of the hazards associated with political uncertainty