Economy of Greece

Mother Earth Travel > Country Index > Greece > Map Economy History

The government has succeeded in reducing budget deficits and inflation, two key factors that allowed Greece to join the Economic and Monetary Union (EMU) on January 1, 2001. On January 1, 2002, Greece, along with 11 out of its 14 EU partners, adopted the euro as its new common currency. The euro is expected to boost trade, help dismantle the last remaining market barriers within the EU, and stimulate production.

The Greek economy is expected to grow 3.5% in 2002 and continue at robust rates above projected EU averages. Years of austerity and reform programs, however, have increased unemployment in some sectors. Foreign investment has also dropped and efforts to revive it have been only partially successful. Greece's large general government debt is projected to drop to 99% of GDP ($135 billion euros) in 2002. Many structural problems persist and privatization of the telecommunications, banking, aerospace, and energy sectors has not moved at the pace originally proposed.

Services make up the largest and fastest-growing sector of the Greek economy. Tourism is a major source of foreign exchange earnings, although the industry has been slow to expand and suffers from poor infrastructure. About 12 million tourists visited Greece in 2001 with net revenues exceeding five billion euros. Industrial activity posted increases for the seventh year in a row, rising by 6.1% in 2000. Greece's food industry is expanding rapidly to support new markets in neighboring countries. High-technology equipment production, especially for telecommunications, is also a fast-growing sector. Agriculture employs about 15% of the work force and is still characterized by small farms and low capital investment, despite significant support from the EU in structural funds and subsidies. Traditionally, a seafaring nation, the Greek merchant fleet totaled 5,101 ships in 2000, with 1850 registered under the Greek flag.

EU Membership
Greece has realigned its economy as part of an extended transition to full EU membership that began in 1981. Greece will assume the rotating EU presidency in the first half of 2003. Greek businesses continue to adjust to competition from EU firms and the government has had to liberalize its economic and commercial regulations and practices. Greece has been granted waivers from certain aspects of the EU's 1992 single market program.

Greece has been a net beneficiary of the EU budget; in 2001 EU transfers accounted for 3.4% of GDP. From 1994-99, about $20 billion in EU structural funds were spent on projects to modernize and develop Greece's transportation network in time for the Olympics in 2004. The centerpiece was the construction of the new international airport near Athens, which opened in March 2001 soon after the launch of the new Athens subway system.

EU transfers to Greece are to phase out over the next decade, when the last of some $24 billion in structural funds are disbursed by 2006. These funds contribute significantly to Greece's current accounts balance and further reduce the state budget deficit. In addition, EU funds will continue to finance major public works and economic development projects, upgrade competitiveness and human resources, improve living conditions, and address disparities between poorer and more developed regions of the country.
 

GDP: purchasing power parity - $181.9 billion (2000 est.)
GDP - real growth rate: 3.8% (2000 est.)
GDP - per capita: purchasing power parity - $17,200 (2000 est.)
GDP - composition by sector:
agriculture: 8.3%
industry: 27.3%
services: 64.4% (1998)
Household income or consumption by percentage share:
lowest 10%: 3%
highest 10%: 25.3% (1993 est.)
Inflation rate (consumer prices): 3.1% (2000 est.)
Labor force: 4.32 million (1999 est.)
Labor force - by occupation: industry 21%, agriculture 20%, services 59% (2000 est.)
Unemployment rate: 11.3% (2000 est.)
Budget:
revenues: $45 billion
expenditures: $47.6 billion (1998 est.)
Industries: tourism; food and tobacco processing, textiles; chemicals, metal products; mining, petroleum
Industrial production growth rate: 7% (2000 est.)
Electricity - production: 46.432 billion kWh (1999)
Electricity - production by source:
fossil fuel:  89.6%
hydro:  9.72%
nuclear:  0%
other:  0.68% (1999)
Agriculture - products: wheat, corn, barley, sugar beets, olives, tomatoes, wine, tobacco, potatoes; beef, dairy products
Exports: $15.8 billion (f.o.b., 2000)
Exports - commodities: manufactured goods, food and beverages, petroleum products
Exports - partners: EU 49% (Germany 15%, Italy 13%, UK 6%), US 6% (1999)
Imports: $33.9 billion (c.i.f., 2000)
Imports - commodities: manufactured goods, foodstuffs, fuels, chemicals
Imports - partners: EU 66% (Italy 15%, Germany 15%, France 9%, UK 6%) (1999)
Debt - external: $57 billion (2000 est.)
Economic aid - recipient: $5.4 billion from EU (1997 est.)
Currency: euro (EUR)

SOURCES: The World Factbook, U.S. Department of State

Mother Earth Travel > Country Index > Greece > Map Economy History