The head of the Ministry of Finance opposed the VAT reduction
New careful reductions of interest rates from the European Central Bank announced the governor of the Bank of Greece Giannis Stournarasspeaking yesterday at the Greek-French Chamber of Commerce and Industry.
In particular, he argued that the “The easing of monetary policy should continue with a series of interest rate cuts at the next ECB Governing Council meetings. But due to the increased uncertainty, our moves should be gradual and cautious and continue to be based on the data available at any given time. Of course, further reductions should not be ruled out if incoming data point to below-target inflation over the medium term.”
This development, however, as he said, is expected to affect the cost of new loans as well as floating rate loans, and the cost of raising funds. These factors, as he said, are crucial for the profitability indicators of Greek banks to remain at the existing level and also for the achievement of the goals set by the banks for credit expansion.
Despite this, he estimated that the prospects of the Greek banking sector are positive.
Referring to the challenges faced by Greek economy the governor of the Chamber of Commerce opposed the VAT reduction and stated that the main priority is to speed up the administration of justice, with the aim of improving the business environment and attracting investments, using measures such as digitization of the procedures, the reorganization of the courts (with the implementation of the new judicial charter) and the promotion of alternative dispute resolution mechanisms.
At the same time, as he underlined, the dependence on external borrowing should be reduced and the financing of investments should be ensured. Finally, measures should be taken to strengthen competition in the markets of goods and services, by eliminating restrictive practices, and removing other obstacles entry and exit of businesses in various branches of economic activity and the improvement of the business environment. The reduction of bureaucracy and more efficient public administration, through digitization and simplification of procedures, will support entrepreneurship.
