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<\/a><\/p>\nStructural reforms and investments through the Recovery Fund, the “light in the tunnel” of the economic crisis and the impact of the pandemic on the Greek economy.
\nThe Deputy Minister of Finance, Theodoros Skylakakis in a revealing interview with grtraveller.<\/p>\n
What are the main features of the 2021 budget?<\/strong><\/p>\n In the 2021 budget we estimate that GDP growth will be 4.8%, while the primary deficit will reach 3.88% of GDP. In particular, the total expenditure of the Budget for 2021 is projected at 67.2 billion. EUR 2.1 billion, down by EUR 2.1 billion. compared to their estimated level in 2020. This decrease is due to the contraction of EUR 5.7 billion. EUR 1.4 billion of pandemic response costs due to the expected reduction in the health phenomenon, as well as the one-off payment of EUR 1.4 billion for the pandemic response. euro for pensioners’ backdated pensioners’ pensions, which took place in 2020.<\/p>\n A significant increase in revenues is also foreseen, mainly due to the projected economic growth and employment growth. Specifically, tax revenues in the Budget are expected to reach 47.8 billion. EUR 3.6 billion, up by EUR 3.6 billion. compared to 2020.<\/p>\n The budget also includes new interventions to support the economy, including a 3 percentage point reduction in insurance contributions for private sector employees, the suspension of the payment of the Special Solidarity Contribution to the private sector, the coverage of insurance contributions by the budget and the \u20ac200 subsidy, in case of hiring a long-term unemployed person for a period of 6 months, the “GEFYRA” programme, which concerns the subsidy of the first home for borrowers and the extension of the VAT reduction and fee suspensions in various categories of goods and services of sectors affected by the pandemic, until April 2021.<\/p>\n Total interventions to address the economic consequences of the coronavirus amount to \u20ac7 billion. and has been earmarked to cover expected expenditure from the extension of the repayable advance measure, the extension of employment and income support measures and additional Health expenditure in the first months of 2021. The distribution between support measures will depend on objective facts, such as the economic impact of the second wave of the pandemic on specific sectors of the economy and the number of beneficiaries.<\/p>\n What are the implications of the pandemic and in particular the second wave? How much are the forecasts for the Greek economy changing?<\/strong><\/p>\n The truth is that the state budget acted as a buffer against the extreme and unprecedented financial pressure created by the pandemic. It is characteristic that, according to our calculations, if it were not for the support measures, amounting to about 24 billion. euro in 2020, the recession would not be limited to the estimated 10.5%, but would reach 17.5% and would be the largest in modern history.<\/p>\n Regarding your question about the second wave of the pandemic and the resulting lockdown, it is clear that this also puts additional pressure on the economy. Evidence of this pressure is the change in our forecasts for the 2020 recession and 2021 growth. Let me remind you that in October the forecast was for a recession of 8-8.5%, and growth of 7.5% in 2021, and after the second lockdown, the forecast changed to 10.5% recession and 4.8% growth.<\/p>\n …the money [of the Recovery Fund] will be allocated to those who want to make investments, not to those who want to get subsidies.<\/p>\n What does the Recovery Plan include, what is its financial size and what are its objectives?<\/strong><\/p>\n The purpose of the Recovery Fund is to carry out structural reforms and investments through a coherent plan that will accelerate economic recovery and, at the same time, contribute to changing the production model and modernising the state’s functions in a green and digital direction.<\/p>\n For our country in particular, the proportion of direct assistance for current expenditure on Covid-19, through the Re-Act EU programme, amounts to \u20ac2.3 billion. EUR 29 billion, while the Resilience and Recovery Fund programme amounts to EUR 29 billion. EUR 16.3 billion, of which EUR 16.3 billion. euros come from subsidies and, up to, 12.7 billion. from loans. This is a huge real amount of money that the government secured in the negotiation and it is our responsibility to spend this money as efficiently as possible.<\/p>\n Among the investments that will be made are thousands of private co-financed investments that will create hundreds of thousands of new jobs, drastic changes in the state with its digitalisation – especially in education, the judiciary and the control mechanisms that fight the shadow economy, as well as interventions to strengthen and modernise the National Health System. In addition, there will be irrigation and flood control projects to prepare for climate change, major projects, road, rail, port, etc., and a major training programme focusing on digital skills.<\/p>\n In order to achieve the goal of economic recovery and recovery, which is literally national, we need thorough and qualitative initial planning (we have already submitted the relevant draft to the European Commission), transparency in implementation and continuous monitoring of the progress of the projects. And let everyone know that the money will be given to those who want to invest, not to those who want to get subsidies.<\/p>\n What are the steps the government plans to take to restart the economy?<\/strong><\/p>\n The two main steps we are planning to restart the economy are the actions foreseen in the 2021 Budget, which I have already mentioned, and the reforms and investments of the Recovery Fund. On the Recovery Fund, we are already in discussions with the Commission and we will start pre-financing projects from national resources in early 2021, taking a measured risk to get the economy moving – restarting faster.<\/p>\n The fight against tax evasion is a concern for all governments. What measures will be taken to combat it and how will tax collection be increased?<\/strong><\/p>\n Fighting tax evasion is one of our central priorities as a government. And the Recovery Fund and its accompanying reforms will make a decisive contribution to this end. Firstly, tax and contribution evasion will be made much more difficult, by technical means. With the introduction of a new generation of cash registers connected online with the tax office and with new control systems that will make use of big data and artificial intelligence, as well as the introduction of the digital work card, which will also record working time directly (online). There will also be new incentives for electronic transactions and a continuation, as soon as fiscal conditions allow, of the reduction of tax rates to reduce the overtaxation that is a key incentive for tax evasion. …until we see the “back” of the pandemic the talk of permanent tax measures cannot yet be made.<\/p>\n Is the government still committed to its programme of tax and contribution cuts?<\/strong><\/p>\n The government is certainly sticking to its program, but until we see the “back” of the pandemic, talk of permanent tax measures cannot yet be made. It is impossible to design permanent measures under such uncertainty, because you don’t have the data to do long-term fiscal planning, but also because uncertainty itself largely cancels out the incentives you are trying to introduce. For this reason, and also because the EU’s general escape clause does not include permanent measures, we have announced a reduction in social security and solidarity contributions for the private sector only for 2021.<\/p>\n Does economic growth come through cooperation between the state and the private sector?<\/strong><\/p>\n Of course. And the Recovery Fund is an ideal opportunity to showcase this cooperation. To this end, the money will mobilise thousands of private investments, while public works will be carried out, where possible, with massive mobilisation of private resources through public-private partnerships (PPPs).<\/p>\n Is there light in the tunnel of the financial crisis?<\/strong><\/p>\n Obviously there is, as long as we manage the Recovery Fund money wisely and prudently and maintain a culture of payment within the country both during and after the pandemic.<\/p>\n Is it an “electric chair” or a challenge for a politician to manage fiscal policy?<\/strong><\/p>\n It is a very heavy responsibility, not only for current developments, but also for future developments. This is because a fiscal policy failure can haunt a nation for decades. By extension, it requires prudence, wisdom and an understanding of the needs of society and the economy, both now and in the future.<\/p>\n What do you like to do in your free time?<\/strong><\/p>\n Simple things. I like to walk in the mountains with my dog, to run – as much as my life and my age allows me -, to swim and to cook, especially for my children, grandchildren and friends. I also like to read a lot. Reading is my great love throughout the years. Unfortunately, however, I have neglected it these days due to work.<\/p>\n Your two favorite destinations in Greece and abroad?<\/strong><\/p>\n In Greece there is my estate in Ilia and Assos in Kefalonia, which unfortunately was hit hard by “Janos”. Abroad, two are my favourite cities, from which I have many memories. One is London, where I did my master’s degree. The other is New York, where my brother-in-law’s family lives and we have visited as guests when my children were still young and have spent a magical Christmas there…<\/p>\n","protected":false},"excerpt":{"rendered":" Interview with Mr. Theodoros Skylakakis, Deputy Minister of Finance to Antonis Kyrikos. Structural reforms and investments through the Recovery Fund, the “light in the tunnel” of the economic crisis and the impact of the pandemic on the Greek economy. The Deputy Minister of Finance, Theodoros Skylakakis in a revealing interview with grtraveller. 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\nThe model change we are pursuing is mainly aimed at shifting to a much more outward-looking economy, internationally competitive, with a much larger “white” part, characterised at the same time by much lower taxes and contributions. This transition is not only an economic change. It fundamentally changes technologies, mindsets and institutions. And it combines economic efficiency with social justice.<\/p>\n