Greek Think-tank Sees Slower Growth, Tourism in 2021 

Athens, Syntagma square. Photo: Visit Greece / Y. Skoulas

Greece’s leading think-tank the Foundation of Economic and Industrial Research (IOBE) revised downward this week Greek government forecasts for a 4.8 percent rebound in 2021 lowering the projection to a 4-4.3 percent rate in its baseline scenario.

The forecast, presented in the IOBE’s quarterly report, is also significantly below EU projections at 5 percent and an International Monetary Fund (IMF) outlook of 5.7 percent and hinges on whether the Covid-19 pandemic subsides in Q1 and Q2 this year and there is no new wave. 

Greek tourism

In the same baseline scenario tourism activity will remain low at 45-50 percent of 2019 levels but double that of 2020, the IOBE said. The government places the figure at 60 percent of 2019 levels. 

IOBE Director General Nikos Vettas underlined that tourism to Greece will depend on whether the pandemic is brought under control across Europe by spring, noting that any forecast seeing tourism revenues “exceed half of what it was before the crisis is optimistic”.

Vettas said Greece is at risk of seeing another lost tourism season if vaccinations are not completed by the end of April, forecasting growth at 0.5-1 percent.

The IOBE also released two more outlooks: a positive scenario, according to which recovery is set at 5-5.3 percent and a worst-case scenario at a 0.5-1 percent rate, which is much closer to the Organization for Economic Cooperation and Development (OECD) projection of 0.9 percent growth in 2021 and foresees a summer similar to last year’s.

Vettas went on to add that none of the scenarios can be ruled out, adding that the development of the pandemic, the effectiveness and reach of vaccination, the upcoming tourism season as well as the use of recovery funds will be the determining factors.

For 2020, the IOBE expects recession at 9-9.5 percent compared to the government’s 10.5 percent forecast.