GIG Economic Bulletin – October 26, 2020

Another market foray with a 15-year bond at record low yields underlined the markets’ confidence in the long-term prospects of the Greek economy, while the prospect of negative short-term growth until 2022 is being aired for the first time.

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Tenders undertaken by Greece’s privatisation fund HRADF have drawn five expressions of interest for the Port of Kavala, and three for Kavala’s natural gas storage facility, while the Port of Piraeus returned to growth in September recording its best performing month in 2020. Meanwhile, Greece raised €2 billion from the markets on Wednesday with a 15-year bond issue, settling on a yield of 1.152%.


The number of registered unemployed increased by 12.8% in September compared to the same month last year. The number of unemployed fell by -5.5% compared to August, primarily due to new jobs in education with the start of the school year.

Industrial turnover fell by -15.1% in August on a Y-o-Y basis, according to the index compiled by the Hellenic Statistical Authority (ELSTAT), which also showed a steep drop of -21.4% compared to July.

Household disposable income shrunk by -11.8% on a Y-o-Y basis in Q2 coinciding with the national lockdown, while spending fell by -12.7% according to ELSTAT figures.

Think tank IOBE has raised the possibility of a -2.5% to -4% recession for the Greek economy in 2021 in a scenario where Europe slides back into lockdown and no vaccine is found for COVID-19. In an optimistic scenario with no worsening of the pandemic, growth could range between 4% and 4.5%.

EU Recovery Fund

A dedicated team of 40 staff from the public and private sectors will be tasked with putting together Greece’s proposal to the European Commission for the Recovery and Resilience Facility, with the main aim of maximising the €32 billion that Greece is entitled to. The task force will be overseen by Alternate Minister of Fiscal Policy Theodoros Skylakakis, who will also be responsible for managing implementation. The Greek proposal is due to be submitted in November.


Greece raised €2 billion from the markets on Wednesday by reopening a 15-year bond issue, in the country’s fifth market foray in 2020. The move attracted offers totalling €16.75 billion from over 280 investors, while the yield settled at a record low for Greek debt of 1.152%.


The government is creating a special task force with a view to introducing incentives to boost corporate mergers. Some of the measures under consideration include tax breaks and the introduction of new corporate structures to make it easier for SMEs to merge, or form clusters and business partnerships. A recent study by EY found that SMEs account for 99.9% of Greek businesses and 19.3% of GDP, while creating 87% of employment. However, the fragmentation of the corporate landscape results is a drag on productivity, which stands at around 50% of the European average.


The Infrastructure and Transport Ministry is lining up a portfolio of new projects worth €13 billion, with the leading role to be played by railway upgrades worth €3.5 billion. The list includes line 4 of the Athens Metro, various highways, and the Hellinikon project. Valued at €1 billion, the project is expected to begin construction in 12 months with all clearances obtained.

Around €5 billion will be spent on investments in northern Greece over the next 5 years, focussing on roads, ports, airports, and railways.


The Piraeus container port returned to growth, recording a rise in traffic of 4.5% in September compared to the same month last year. Over 438 thousand TEU moved through Piraeus in September, the highest monthly number in the year to date, and the second among the 12 terminals globally operated by COSCO Shipping Ports.

Piraeus Container Terminal Copyright: Aerial-motion / Shutterstock


The concession of the Port of Kavala drew five expressions of interest at the opening of the tender process by privatisation agency HRADF. PFIC, Quintana, Imerys-Goldair-IMG, International Port Investments Kavala, and the Port of Thessaloniki all participated, showing a large overlap with the potential bidders in the Port of Alexandroupolis.

The Kavala natural gas storage facility has attracted expressions of interest from the consortiums of DESFA-TERNA, Energean-East Gas, and CMEC-Maison. The 50-year concession will include converting the near-depleted natural gas field 6km west of Thasos into an underground storage facility.


Tourism revenues in the period January-August 2020 totalled just €2.68 billion, an 80% drop compared to the €10.5 billion achieved over the same period last year, according to the Bank of Greece. Receipts will now struggle to reach the pessimistic €3 billion forecast by the end of 2020.

COVID-19 measures

The government has published a 4-tier COVID alert system for the country’s regions, in an effort to combat the appearance of localised clusters as the daily national case numbers this week climbed above 900 for the first time since the start of the pandemic. Masks were made mandatory outdoors and a night-time curfew was introduced for areas in tiers 3 and 4, including Attica and Thessaloniki.

Stock market

The ASE general index showed little signs of recovery, falling by -1.27% on a weekly basis to close at 612.32 points. Uncertainty over COVID-19 and geopolitical tensions in the Eastern Mediterranean are said to be the main factors behind the overall underperformance of the Greek stock market, which has lost a third of its value since the start of the pandemic.

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