Greece Country Risk Report

Published 23 June 2015 | Quarterly

  • 58 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
$1,195.00
Greece Country Risk Report

Core Views

  • Greece's economy will grow only slightly in 2016, following a significant recession in 2015.

  • Although agreeing a third bailout has reduced uncertainty surrounding the country's eurozone membership, tough fiscal conditions attached to the deal will dampen growth over the coming years.

  • Greece's massive debt pile will remain unsustainable, unless the country is offered a formal debt haircut from its creditors. Eurozone opposition means this is unlikely to happen.

  • On the plus side, Greece's external position is now much improved, as the collapse of the current account deficit has reduced the country's annual financing requirement.

  • Deflation will persist for some time to come, as the country continues its painful internal devaluation, due to weak domestic demand and a further leg down in global oil prices.

  • Whichever party prevailed at the September election will struggle to retain domestic support, due to the painful nature of structural reforms demanded by its creditors.

Major Forecast Changes

  • We have revised down our forecasts for real GDP decline by 1.8% in 2015, from a 1.1% decline previously, due to the ongoing impact of bailout uncertainty and capital controls.

Key Risks To Outlook

  • We believe Greece's dire economic growth outlook and the unsustainable debt load will continue to cause problems for the country, and it is likely that the country's membership of the eurozone will come under threat once again at some point over the coming years.

Macroeconomic Forecasts (Greece 2013-2016)
Indicator 2013 2014 2015f 2016f
e/f = BMI estimate/forecast. Source = National Sources/BMI
Nominal GDP, EURbn 182.4 179.1 173.7 174.5
Real GDP growth, % y-o-y -3.9 0.8 -1.8 0.6
Consumer price inflation, % y-o-y, eop -1.8 -2.6 -1.2 0.8
Exchange rate EUR/USD, eop 0.72 0.83 0.98 0.91
Budget balance, % of GDP -12.3 -3.5 -3.3 -2.7
Current account...
Executive Summary
5
Core Views
5
Major Forecast Changes
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Domestic Politics
8
Table: Political Overview
8
Domestic Politics II
9
Long-Term Political Outlook
12
Chapter 2: Economic Outlook
15
SWOT Analysis
15
BMI Economic Risk Index
15
Economic Activity
16
table: Economic Activity
16
Balance Of Payments
19
table: Balance Of Payments
19
Monetary Policy
21
table: Monetary Policy
21
Banking Sector
23
Regional Monetary Policy
24
Regional Economic Outlook
26
Regional Exchange Rate Forecast
28
table: BMI Eurozone Currency Forecasts
28
Chapter 3: 10-Year Forecast
31
The Greek Economy To 2024
31
table: Long-Term Macroeconomic Forecasts
31
Chapter 4: Operational Risk
33
SWOT Analysis
33
Operational Risk Index
33
Investment Climate
34
Lack Of Policy Clarity Heightening Operational Risks
34
table: Infrastructure Privatisation Overview
34
Operational Risk
39
tABLE: Developed States - Labour Market Risk
39
Table: Developed States - Logistics Risk
42
Table: Developed States - Crime And Security Risk
44
table: Developed States - Trade And Investment Risk
46
Chapter 5: Key Sectors
49
Automotives
49
table: Autos Total Market - Historical Data And Forecasts
49
Food & Drink
51
table: Food Consumption Indicators - Historical Data & Forecasts
52
Other Key Sectors
57
table: Oil and Gas Sector Key Indicators
57
table: Telecoms Sector Key Indicators
57
table: Infrastructure Sector Key Indicators
57
table: Pharma Sector Key Indicators
58
table: Defence and Security Sector Key Indicators
58
table: Freight Key Indicators
58
Chapter 6: BMI Global Macro Outlook
59
Global Outlook
59
Deflationary Pressure
59
Table: Global Assumptions
59
Table: Developed States, Real GDP GrowtH, %
60
Table: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
60
Table: Emerging Markets, Real GDP Growth, %
61

The Greece Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Greece. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Greece's economic, political and financial prospects through end-2019, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses

  • Forecast the pace and stability of Greece's economic and industry growth through end-2019.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Greece's country risks against regional peers using BMI's country comparative Risk Index system.
  • Evaluate external threats to doing business in Greece, including currency volatility, the commodity price boom and protectionist policies.

The Greece Country Risk Report by Business Monitor International (BMI) includes four major sections: Economic Outlook, Political Outlook, Operational Risk and Key Sector Outlook.

Economic Outlook:

How will the Greece' economic policy-making and performance impact on corporate profitability over 2015-2019?

BMI provides our fully independent 5-year forecasts for Greece through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Greece Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector obligations).
  • Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Greece and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Greece, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Greece over the next 5-years?

BMI's Greece country Risk Index evaluates the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Greece Market - Political Strengths, Weaknesses, Opportunities and Threats facing Greece.
  • Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Greece's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
  • Long-Term Political Outlook BMI examines the structural risks to the stability of Greece’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.

Key Benefits

  • Benchmark Greece's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Operational Risk

What are the current operational risks and difficulties associated with doing business in Greece?

The Operational Risk section gives an evaluation of current risks and difficulties associated with operating in the market. It also provides a brief overview of the regional Operational Risk Index which benchmarks Greece against its neighbours.

Operational Risk Contents

The chapter provides a summary of the main threats in the country, within:

  • Labour Market Risk (Education; Availability of Labour; and Labour Costs)
  • Logistics Risk (Market Size and Utilities; Quality and Extent of the Transport Governance)
  • Trade and Investment Risk (Economic Openness; Government Intervention; and Legal Risks)
  • Crime and Security Risk (Crime; Terrorism; and Interstate Conflict risks).

Key Sector Outlook*

Which industry sectors in Greece will grow fastest, and where are the major investment opportunities in the market?

BMI identifies investment opportunities in Greece's high growth industries including automotives, defence & security, food & drink, freight transport, infrastructure, oil & gas, pharmaceuticals & healthcare and telecommunications & IT.

Key Areas Covered:

  • Market Overview - Size and value of each industry, including recent sector developments and major industry key performance indicators (KPIs) that have impacted company performance.
  • 5-year Industry Forecasts - Forecasts for each year over 2015-2019, using BMI's proprietary industry modelling technique, which incorporates key domestic and international indicators - including economic growth, interest rates, exchange rate outlook, commodity prices and demographic trends - to provide fully integrated forecasts across and within each industry.
  • Demand- and Supply-Side Data/Forecasts - BMI's industry data covers both the output of each industry and the domestic demand, offering clear analysis of anticipated import/export trends, as well as capacity growth within each industry.

Key Benefits

  • Target strategic opportunities in high growth industries, which are benefiting from global mega trends, and thus offer strong investment and growth opportunities.
  • Compare the growth path of different industries to identify which are best placed to benefit from domestic and international economic prospects, and which have historically suffered from volatile growth trends - a key indicator of future risks.

*Not all Country Reports contain the Key Sector Outlook chapter. Please enquire above for more information.

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