Reforms: What challenges does Greece still face?
Although Greece’s achievements in rebounding from a deep crisis have been remarkable, significant challenges remain. Efforts must continue to liberalise the economy, create an effective public administration, as well as a business-friendly environment. Unemployment remains very high (19.5% in May 2018), and sustainable growth is the only way for Greece to deliver more jobs and prosperity for its people.
Greece needs to build upon the progress achieved under the ESM programme and strengthen the foundations for a sustainable recovery, notably by continuing and completing reforms launched under the programme. In an annex to the Eurogroup statement of 22 June 2018, the Greek government committed to ensure the continuity and completion of reforms in several key areas:
- Fiscal and structural (primary surplus of 3.5% of GDP over the medium-term)
- Social welfare (modernising pension and health care systems)
- Financial stability (continued reforms aimed at restoring the health of the banking system, including NPL resolution)
- Labour and product markets (action plan on undeclared work; investment licensing reform; completing the cadastre project)
- Hellenic Corporation of Assets and Participations (HCAP) and privatisation (asset development plan; completing key transactions)
- Public administration (modernising human resource management in the public sector; new labour law code; implementing anti-corruption recommendations).