IMF: Greek Economy to Grow by 2.6% in 2018, Weaken in 2022

The International Monetary Fund on Tuesday said that the Greek economy will grow by 2.6% in 2018, up from a 2.4% growth rate estimated in a draft budget plan tabled to Parliament by the Greek government last week.

The Fund’s estimate for the Greek economy this year is that it will grow by 1.8%, a figure which many of the country’s lenders deem as very optimistic.

In its annual report, to be published in full on Wednesday, the IMF said, however, that the dynamism of the Greek economy will gradually weaken, and is expected to grow by a mere 1% in 2022.

The European Commission forecasts that Greece will grow by an annual rate of 1.5% in the period 2021-2024.

If the IMF report retains its primary surplus forecast for Greece at 2.2% of gross domestic product for next year, there may be a new discussion on additional fiscal measures of 2.3 billion euros so as to reach the target of 3.5 percent of GDP, says Kathimerini.

If the IMF insists on this position and the Europeans – especially the Germans – insist on the participation of the Fund in the Greek program, negotiations could stumble again, hampering the third bailout review, the Greek paper notes.

The IMF is also expected to say that the unemployment rate will fall from 22.3% this year to 20.7% in 2018, while the inflation rate will rise to an average rate of 1.3% in 2018 from 1.2% in 2017.