Greece: Economy Overview

Greece has a capitalist economy with the public sector accounting for about 40% of GDP and with per capita GDP about two-thirds that of the leading euro-zone economies.

Economy - overview:

Tourism provides 15% of GDP. Immigrants make up nearly one-fifth of the work force, mainly in agricultural and unskilled jobs. Greece is a major beneficiary of EU aid, equal to about 3.3% of annual GDP. The Greek economy grew by nearly 4.0% per year between 2003 and 2007, due partly to infrastructural spending related to the 2004 Athens Olympic Games, and in part to an increased availability of credit, which has sustained record levels of consumer spending. But growth dropped to 2% in 2008. The economy went into recession in 2009 and contracted by 2%, as a result of the world financial crisis, tightening credit conditions, and Athens' failure to address a growing budget deficit, which was triggered by falling state revenues, and increased government expenditures. Greece violated the EU's Growth and Stability Pact budget deficit criterion of no more than 3% of GDP from 2001 to 2006, but finally met that criterion in 2007-08, before exceeding it again in 2009, with the deficit reaching 13.7% of GDP. Public debt, inflation, and unemployment are above the euro-zone average while per capita income is below; debt and unemployment rose in 2009, while inflation subsided. Eroding public finances, a credibility gap stemming from inaccurate and misreported statistics, and consistent underperformance on following through with reforms prompted major credit rating agencies in late 2009 to downgrade Greece's international debt rating, and has led the country into a financial crisis. Under intense pressure by the EU and international market participants, the government has adopted a medium-term austerity program that includes cutting government spending, reducing the size of the public sector, decreasing tax evasion, reforming the health care and pension systems, and improving competitiveness through structural reforms to the labor and product markets. Athens, however, faces long-term challenges to push through unpopular reforms in the face of often vocal opposition from the country's powerful labor unions and the general public. Greek labor unions are striking over new austerity measures, but the strikes so far have had a limited impact on the government's will to adopt reforms. An uptic in widespread unrest, however, could challenge the government's ability to implement reforms and meet budget targets, and could also lead to rioting or violence. In April 2010 a leading credit agency assigned Greek debt its lowest possible credit rating; in May, the International Monetary Fund and Eurozone governments provided Greece emergency short- and medium-term loans worth $147 billion so that the country could make debt repayments to creditors. In exchange for the largest bailout ever assembled, the government announced combined spending cuts and tax increases totalling $40 billion over three years, on top of the tough austerity measures already taken.

GDP (purchasing power parity):

$332.9 billion (2009 est.)
country comparison to the world: 35
$339.7 billion (2008 est.)
$333 billion (2007 est.)
note: data are in 2009 US dollars

GDP (official exchange rate):

$330.8 billion (2009 est.)

GDP - real growth rate:

-2% (2009 est.)
country comparison to the world: 152
2% (2008 est.)
4.5% (2007 est.)

GDP - per capita (PPP):

$31,000 (2009 est.)
country comparison to the world: 43
$31,700 (2008 est.)
$31,100 (2007 est.)
note: data are in 2009 US dollars

GDP - composition by sector:

agriculture: 3.8%
industry: 16.3%
services: 79.9% (2009 est.)

Labor force:

4.98 million (2009 est.)
country comparison to the world: 75

Labor force - by occupation:

agriculture: 12.4%
industry: 22.4%
services: 65.1% (2005 est.)

Unemployment rate:

9.4% (2009 est.)
country comparison to the world: 112
7.7% (2008 est.)

Investment (gross fixed):

16.8% of GDP (2009 est.)
country comparison to the world: 123

Budget:

revenues: $108.9 billion
expenditures: $161.5 billion (2009 est.)

Inflation rate (consumer prices):

1.2% (2009 est.)
country comparison to the world: 51
4.1% (2008 est.)

Commercial bank prime lending rate:

8.59% (31 December 2009 est.)
country comparison to the world: 109
8.65% (31 December 2008 est.)

Stock of domestic credit:

$419.9 billion (31 December 2009 est.)
country comparison to the world: 26
$394.6 billion (31 December 2008 est.)

Agriculture - products:

wheat, corn, barley, sugar beets, olives, tomatoes, wine, tobacco, potatoes; beef, dairy products

Industries:

tourism, food and tobacco processing, textiles, chemicals, metal products, mining, petroleum

Industrial production growth rate:

-8.8% (2009 est.)
country comparison to the world: 136

Oil - production:

6,779 bbl/day (2009 est.)
country comparison to the world: 89

Natural gas - production:

9 million cu m (2009 est.)
country comparison to the world: 91

Current account balance:

-$34.43 billion (2009 est.)
country comparison to the world: 184
-$45.16 billion (2008 est.)

Exports:

$21.34 billion (2009 est.)
country comparison to the world: 66
$29.14 billion (2008 est.)

Exports - commodities:

food and beverages, manufactured goods, petroleum products, chemicals, textiles

Exports - partners:

Germany 11.11%, Italy 11.05%, Cyprus 7.28%, Bulgaria 6.74%, US 4.95%, UK 4.4%, Turkey 4.23% (2009)

Imports:

$64.2 billion (2009 est.)
country comparison to the world: 39
$93.92 billion (2008 est.)

Imports - commodities:

machinery, transport equipment, fuels, chemicals

Imports - partners:

Germany 13.73%, Italy 12.71%, China 7.08%, France 6.1%, Netherlands 6.02%, South Korea 5.68%, Belgium 4.34%, Spain 4.08% (2009)

Debt - external:

$552.8 billion (30 June 2009)
country comparison to the world: 17
$504.6 billion (31 December 2008)

Stock of direct foreign investment - at home:

$44.93 billion (31 December 2009 est.)
country comparison to the world: 55
$38.12 billion (31 December 2008 est.)

Stock of direct foreign investment - abroad:

$40.45 billion (31 December 2009 est.)
country comparison to the world: 33
$37.23 billion (31 December 2008 est.)

Exchange rates:

Source: CIA - The World Factbook