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Tuesday 20th March 2018

Greece Tackles Recession with Reforms


7Dnews London - AFP

Sat, 07 Sep 2019 21:23 GMT

In the country's attempt to recover from an unprecedented debt crisis, Greece's Prime Minister Kyriakos Mitsotakis has announced extreme reforms with fiscal measures to attract foreign investment, AFP reported on Saturday, September 7th.

Thanks to the reforms, Greece would regain its credibility that would favour more investment, create new wealth and boost employment, he told the annual Thessaloniki International Fair.

The reforms include a cut in corporate income tax from 28% to 24% and on dividends from 10% to 5%.

Mitsotakis has pledged to ease tax rates for low wage earners and measures to support the country's large construction sector.

The prime minister was elected in July and set a priority of boosting economic growth and investment, and while visiting France, Germany and the Netherlands last August, he tried to encourage investors there to take up the opportunities being offered by his new conservative government.

Nonetheless, the economy remains fragile, despite Greece's current attempts to recover from a six-year recession and a nearly decade-long debt crisis.

Greece has a public debt of more than 180% of its gross domestic product and remains under strict supervision by its EU and IMF creditors. It emerged from its third bailout last year.

Nonetheless, both the EU and IMF want Greece to pursue economic and fiscal reforms and privatisations and achieve primary budget surpluses, which exclude government debt interest payments, worth 3.5% of the GDP in the coming years.

On Saturday, September 7th, around 8,000 people rallied in Thessaloniki, calling for more jobs and lower taxes. Meanwhile, in Brussels last Wednesday, outgoing IMF chief Christine Lagarde said she felt the 3.5% level "is excessive and is putting undue pressure on the recovery of the Greek economy."