Greece is the world champion in supporting its economy, thanks partly to the inflow of resources from the Next Generation EU fund, ING notes in a new report.
Adding up the various support measures the Greek government has taken and the funds set to flow into the Greek economy from Brussels, the Netherlands-based multinational calculates that the total package the Greek state will have to address the pandemic’s effects amounts to 32.1% of the country’s gross domestic product – the world’s highest rate, topping even that of the US.
ING examined the additional fiscal spending countries have made or have promised to make in response to Covid-19, and the sum of the US comes to 25.5% of its GDP. That includes the approved proposal for the US recovery plan, but not the new proposals by President Joe Biden that are yet to receive approval in Congress. For the eurozone this rate comes to 12.4% following the addition of the Recovery and Resilience Facility to national fiscal spending against the pandemic. That rate might actually be overestimated, as some projects may have been counted twice, as they were planned both on a national and a European level.
Italy ranks third internationally, after Greece and the US, with its rate at 21.9% of GDP.
ING stresses that the positive impact on the Greek economy will likely be smaller as part of the Greek proposal concerns NGEU loans that are destined for the partial financing of private investments. It also highlights that the US support already agreed has a far greater effect than the Italian and Greek plans.
The Dutch company goes on to say that the Greek plan is very balanced, along with that of Portugal, as it contains many projects besides the green and digital transitions. Greece, it notes, places great emphasis on investments related to human resources, as skills and employment constitute basic sectors in which the country has lagged since the global financial crisis.
In general, ING notes that although the NGEU was planned to help EU states rebound from the crisis, demand for those resources remains low.