The money from the Recovery Fund and the ‘Greece 2.0’ programme will help the country regain a part of the growth lost during the pandemic, provided that it is invested correctly, Alternate Finance Minister Thodoros Skylakakis said in an interview with the Athens-Macedonian News Agency (ANA) published on Sunday.
“This is our job. To make sure this money is invested correctly. Do not forget that ‘Greece 2.0’ is strictly an investment programme,” he said.
Asked about the possibility of “new targeted measures” given the promising figures for growth, Skylakakis pointed out that there were problems that were still unfolding, such as the pandemic and the spike in prices, as well as “significant sums” in the cash reserves of the next budget. This meant that there will “obviously be measures that we do not know yet and which will be made specific over the course of the next year,” he clarified, including in the energy sector.
“We have made a commitment for a permanent mechanism in order to deal with instability and high prices, whenever these arise in the energy sector,” he added.
He confirmed that the pandemic has cost Greece more than 40 billion euros but highlighted that the country had also gained large sums, the highest per capita in Europe, from EU funds in the form of subsidies and low-interest loans from the Recovery Fund that covered roughly half this amount.
“At the same time, we moved rapidly in the area of reforms, something that is generally acknowledged worldwide….In this way we have laid the foundations for a much faster growth process that in five to 10 years will fix the damage done by the pandemic in terms of increasing the public debt,” he added.
On the threat of inflation, he said that the high prices need not lead to higher inflation unless the temporary increases are made permanent by a spiral of increasing wages and prices. “This will not happen in the Eurozone and for this there is the European Central Bank, which has set 2 pct as a long-term target,” he said.
He explained that the money from the Recovery Fund will be partly spent on public works and partly on social infrastructure and actions, all of which would benefit “large numbers of people”. Roughly 1.5 billion euros will be spent to support small and medium-sized enterprises that want to make investments, while a large loan programme will be open to all businesses that are able to build a “bank profile” in the next three years.
According to Skylakakis, the plan will give priority to the green transition, the digital transition, health, education, private investments, covering the investment gap with emphasis on digital and green investments, openness and collaborations and mergers, in that order.