Greece ranks first in Europe in adjustment

The Troika might be questioning the progress in structural changes, according to the think tank Lisbon Council, however, Greece ranks first on reforms in Europe for the second consecutive year.

According to a report presented yesterday in Brussels, attended by European Commission Vice-President Olli Rehn, Greece ranks first in fiscal adjustment and reforms, second, after Ireland, in reducing labour costs and records one of the best performances in reducing the deficit of its current account balance.

 
Read the report here

In total it is the most effective country in the overall adjustment. Greece also improved the structural primary budget balance by 14.9% of GDP in four years, s performance that is characterized, stunning, unprecedented and unrepeatable. Spain, which holds the second position, improved its balance by 6.6% of GDP over the last four years.
 
"The shrinkage of the external and fiscal deficits in countries under memoranda means that most do not live beyond their powers. Contrary to what is said about "moral hazard" the results of our research show that these countries have made enormous efforts and deserve the help they receive from the Support Mechanism," the report says.

Specifically for Greece it notes that "80% of fiscal adjustment has been completed. With short-term challenge of fiscal consolidation being almost treated, what remains is to further improve the long term development of the country."

Analysts point out that although workers in Greece have suffered the greatest salary compression in Europe (labor costs per unit decreased by 13.8%), now entrepreneurship meets other obstacles, as Greece remains lowest in European bureaucracy with the licensing process of new businesses being still the most expensive in Europe.

The report entitled "Euro Plus Monitor" ranks EU countries on four indicators: current account balance adjustment, fiscal adjustment, labour cost adjustment and reforms.