GIG Economic Bulletin – March 8, 2022

Annual GDP growth came in at 8.3% beating the official projection by a wide margin. The government is bracing for a hit to tourism and high energy prices due to the war in Ukraine, however it is also set to hit the accelerator on a series of strategic energy projects of regional significance.

Economic Bulletin
With the bolstering of energy security at the top of the Greek government’s agenda – and energy prices on the rise – PM Mitsotakis unveiled plans to develop a second FSRU in Alexandroupolis. Interest in a majority stake in the Port of Alexandroupolis is on the rise due its growing geopolitical importance. Meanwhile, Greece’s tourism sector is expecting a 5% decline in revenues in 2022 due to the war in Ukraine.


The economy grew by 7.7% Y-o-Y in Q4 2021 according to the Hellenic Statistical Authority (ELSTAT), bringing annual growth to 8.3%, beating the official budget projection of 6.9%. GDP reached €181 billion in constant terms.

The Centre of Planning and Economic Research (KEPE) forecasts growth of 5.24% in H1 2022, noting a high degree of uncertainty due to geopolitical tensions and inflation.

UBS has raised its forecast for 2022 growth to 5.5% based on the expected inflow of EU funds, tourism, and continued domestic consumption based on household savings.

The Finance Ministry is expected to issue a revised budget in the coming days. It is likely to include inflation of 3-4% (from the original 1%) and growth as low as 3.5% (from 4.5%). The government estimates the economy will lose €600 million for every 10-euro rise in natural gas prices.

The European Commission was positive on the completion of Greece’s 15 RRF milestones for 2021 and the disbursement of the first tranche of €3.6 billion. The ministry expects the disbursement in April, split into €1.72 billion in the form of grants and €1.85 billion in loans. 

Inflation hit 6.3% in February up from 5.5% in January according to EUROSTAT’s HICP estimate. Eurozone inflation rose to a record 5.8% from 5.1%. Energy costs were up 32%, while food, alcohol and tobacco rose 4.1%.

EUROSTAT’s producer price index for Greece was up 32% on an annual basis in January compared to 30.6% for the eurozone. Electricity and natural gas supply prices were up 62%.

IOBE’s economic sentiment index remained stable in February, holding on to 114 points compared to 114.2 in January. However, retail and consumer sentiment deteriorated slightly.

The PMI dropped marginally to 57.8 points in February from 57.9 in January, due to a slowdown in new orders.

Retail turnover was up 24% Y-o-Y in December according to ELSTAT, while the increase by volume was 19%. Clothing and shoes recorded the biggest increases, with 132% and 125% respectively.

Unemployment edged up to 13.3% in January from 13% in December according to ELSTAT. Greece continues to have the highest unemployment in the EU, however the level remains below last January’s 16.2%.


The consortium behind the Alexandroupolis natural gas FRSU will be applying for a license for a second FRSU in the area with 170,000 m3 capacity. The project was announced by Greek Prime Minister Mitsotakis in the context of increasing security of energy supplies.

Mitsotakis held a teleconference with Egyptian President Al-Sisi to confirm Greece’s commitment to prioritise building the Greece-Egypt interconnector.

PPC has confirmed the completion of the transfer of 49% of HEDNO/DEDDIE to Macquarie Asset Management and the appointment of a new Board of Directors.

Mytilineos announced the completion of a 1.55 MW photovoltaic (PV) project in South Korea, and has obtained a permit for a further 36 MW of PV development in the country.


HRADF has received one binding offer for the 40-year concession on Kavala Port from the consortium of Black Summit Financial Group-EFA Group-GEK Terna.

Interest in the 67% stake of the Alexandroupolis Port is heating up in advance of the 5 May deadline for binding offers, in light of its potential geopolitical importance as an alternative to Black Sea ports. Four bidders are in the running, including Texas-based Quintana, the International Port Investments Alexandroupolis consortium of GEK Terna, Black Summit Investment Group, Euroports and EFA Group, the Cameron-Goldair Cargo-Bollore Africa Logistics consortium and the Thessaloniki Port Authority.

Alexandroupolis Port. Copyright: Nicolas Economou /


Around 5% (€1 billion) could be shaved off tourism revenues in 2022 due to the Ukraine crisis according to government estimates. The Tourism Ministry is preparing for the impact of the Ukraine conflict on the sector. Greece received 750,000 Russian travellers in 2019 and was expecting 500,000 this summer, while the number of U.S. travellers is also expected to fall due to perceived risk.

Real Estate

Four hotels and 372 residential units are the first deliverables from Lamda Development at Hellinikon. Lamda expects revenues of €950 million from the residences, of which €250 million at projected for 2022. Construction projects valued at a total €0.5 billion are about to go to tender for the flagship redevelopment project, including sports facilities and the 130,000 sqm Vouliagmeni Mall.

Sanctions on Russia are not expected to have a significant impact on Greece’s Golden Visa programme, as Russian nationals represent just 6.2% of beneficiaries since the start of the scheme.

Building permits were up 43% Y-o-Y in November, while there was a 62% increase in area and 76% increase in volume according to ELSTAT. For the period Jan-Nov 2021 permits were up 25% vis-a-vis the same period of 2020.

Commercial property deals totalling €790 million have already been booked since the start of 2021. Yields on commercial property range between 6-8.5% depending on the area.


Bankers speaking at Fin Forum do not see any early signs of a rise in NPEs as a result of inflationary pressures on households, while there is widespread belief that the government will grant an extension to the Bridge I & II mortgage subsidy schemes.

Servicers have so far cured €2.8 billion of bad loans on behalf of banks. The total of bad loans under management, including those purchased by funds and servicers, is €110 billion.

Auctions on the primary residence of 3,000 vulnerable households will freeze. The Prime Minister said a safety net has been placed under those who are being tested by the difficult economic circumstances.

Pancreta Bank has submitted its formal proposal for the acquisition of HSBC’s business in Greece to the Bank of Greece.

Stock Market

The ASE general index suffered weekly losses of -11.37% to close at 821.74 points, wiping off all the year’s gains so far in a generalised sell-off in reaction to the war in Ukraine and economic sanctions imposed on Russia. Banks were the biggest losers plummeting -21.9% on a weekly basis, large caps retreated by -12.7%.

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