DIANEOsis: The Recovery Fund an opportunity of historic proportions to fill the investment gap

The “Greek Economic Outlook” was compiled by diANEOsis analysts.

The arrival in the coming years of important European resources from the Recovery and Sustainability Fund (TAA), in combination with the new NSRF and the CAP, is an opportunity of historic proportions for our country not only to completely fill the deficit of investment of a decade , if the funds are directed entirely in terms of investments, but also to seek a reorientation of the Greek economy towards a new growth model that will give it a lasting and sustainable boost for the coming decades, according to the “Perspective of the Greek economy. Economy” prepared by diANEOsis analysts.

Optimum use of resources is required, underlines diANEOsis

According to analysts, the optimal use of these resources is not evident and continues to be in demand, just as the result they will have is not evident. It is necessary to optimize their distribution to productive and properly targeted investments, in order to ensure not only the full coverage of the investment gap, but also the “leap forward” of the Greek economy on a long-term sustainable growth course. This historic opportunity should not be missed, they stress.

In more detail, in the extensive study on the Greek Economy of more than 100 pages on “Its real situation, its risks and prospects” prepared by diANEOsis Research Director Dr. Faye Makantasi and research analyst Elias Valenti, they emphasize that it is appropriate to pursue maximum strategic focus in the allocation of TAA resources, but also in general in the investment policy of the country. This strategic objective should focus first on labor-intensive sectors, i.e. give relatively higher priority and greater incentives to invest in work-based businesses that are comparatively more labor-intensive than others. production factors.

Each unit of physical capital will create jobs, says diANEOsis

According to diANEOsis researchers, each additional unit of natural capital will create more new jobs, reducing the stock of unused resources called unemployment more quickly. The researchers also highlight the special care that should be given to the relatively greater stimulus of investments that will contribute more to the competitiveness and extroversion of the Greek economy.

The significant opportunities and challenges ahead for the Greek economy do not come without corresponding significant risks and uncertainties, they point out, noting that, first of all, the pandemic is not over; we know for sure what the future holds, estimate Dr. Faye Makantasi and Elias Valentis.

Analyzing the uncertainties, they point out that due to the pandemic crisis and other independent factors, an explosive rise in energy prices emerged from mid-2021, combined with doubts about Europe’s energy security. Energy is a virtually irreplaceable intermediate good that is used in the production of all other goods and can therefore be described as the “bread of the economy,” according to diANEOsis researchers.

The maintenance of high rates of energy poverty in Greece requires the adoption of specific measures to empower its vulnerable “end consumers”. However, these measures have little benefit, because they cannot protect weak households from the indirect effects of the energy crisis. As the cost of energy enters all links of each value chain, the huge increases in its price inevitably pass through to the price of all final and intermediate goods. Therefore, the need arises for the general reduction of the “transmission” of the “virus” of the enormous energy costs between the fabrics of the economy, and especially the productive economy, say the researchers.

In their extensive report on debt, the researchers conclude that the best option to deal with the debt issue is none other than the rapid “leap forward” of the Greek economy, with the achievement of significant and sustainable growth rates in the coming years. years. . In this way, the need for immediate reforms that rid our economy of its fundamental weaknesses becomes even more urgent.

At the end of the investigation, it is estimated that, despite the hope of improving the image on the front of the pandemic before the summer, there is a long way to go before Greece enters a path of sustainable economic, social and political development. . . To avoid a new fiscal derailment in our country, the researchers estimate, it is important that the financial resources that will enter in the coming years do not create the illusion that “there is money” and thus lead to inaction, but instead mobilize “money to take place.” Target productive and innovative investments that will increase the country’s exports, generate new jobs and have the maximum growth footprint. To achieve this, reforms in the public sector and markets are one way, as well as addressing significant challenges that undermine development, such as Greece’s rapidly aging population or the very small number of babies being born and therefore , of young people reaching a later working age. age to join the whole of the economically active population.

Attached is the complete overview of the Greek economy “Its real situation, risks and prospects”

source: iefi merida