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Economic trajectory remains favorable but imbalances grow

Greece Macro Monitor

01 Μαΐου 2007

• The economy’s outlook remains positive and we now see real GDP growth averaging 4.0% this year. The general government budget deficit is expected to remain at sub-3% of GDP levels, rendering an exit from the excessive deficit procedure (EDP) feasible as early as June 2007.
• Economic prospects for the coming 2-3 years are generally positive, but the sustainability of the present buoyant rates of economic growth in the mediumterm will require a transformation of the existing model of economic development to one depending more on exports and business investment. This, in turn, will facilitate the correction of long-lasting imbalances, obvious consequences of which are the high level of inflation and a wide current account deficit

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