Rating "BB-" of Greece


The rating "BB-" of Greece, reinforced by Fitch, holding a stable and a view.

The valuation group, among other things, indicates that the crisis of financial crisis in Greece has shown an unequivocity in the effectiveness of the administration and its operation. Emphasis on political and social sustainability, the quality of government structures is still much stronger than most of the countries that are also below the level of investment. He also notes that the government's debt profile is very favorable and that fiscal performance over the last three years has been stronger than those countries with co- suitability.

Fitch is hoping that the economic revival in Greece will have a big impact in 2019. It is expected that a mixed demand, which will reduce unemployment, Increasing devastating income and fiscal loss increase in home demand. The company will have a & # 39; It is estimated that growth of 2.3% will be in 2019 and 2.2% in 2020.

The short-term vision for private spending, according to Fitch, is positive. Increasing 4% housing equity income in the third quarter of 2018, is the highest since 2008. The rate of salary continues to grow gradually and still have inflation intermediate levels. The unemployment rate remained at 18.6% in October 2018 (at least seven years), although the unemployment rate was less than a year; up by 1.8% in the 10 months between January and October. Users' confidence was encouraged to complete the third successful change program in August 2018.

The government has risen in the lowest payment by 11% (to 650 euros per month) and eliminate "wages" salary for staff aged under 25, and The group says that it has also made changes to the Labor framework's legislative framework. He also commented on the use of joint ventures and contracts in some sectors of the economy, such as tourism, says Ftich, saying that the rationale for these measures is to encourage more active spending in the short term.

Although it is too early to measure its full impact, these measures can have a bad impact on salary negotiations, but also on the competitiveness of the Greek economy over time, Fitch wants. In mid-term, the social partners' opinion in general negotiation negotiations will be the main purpose to be monitored, and in response.

Public money continues to & # 39; development, Fitch says, the remainder in 2018 at 3.7% of GDP, is higher than the 3.5% economic program target of a 3.5% surplus. The company expects to have a fiscal policy; stable and basic funding of 3.4% of GDP in 2019 and 3.3% in 2020. It indicates that there are risks in fiscal projections; from recent judgments against the 2012 cuts of pensions and from a CoE decision to wait for pension reform in 2016.

According to Fitch, the current fiscal policy may not be sustained by 2020. Fiscally stable is largely based on tax revenue and a reduction in public spending, in particular a sub-implementation of its & # 39; Public Investment Program. The challenge for future Greek governments is to expand the mix of fiscal policy without compromising the achievement of the objectives, house estimates.

In this context, the taxpayer reduction of income from tax-free income (which comes into effect in January 2020) aims to expand the tax base and may provide a fiscal range to reduce tax liabilities over time. Fitch is expecting that this step will not be correctly communicated and implemented, and stresses that there is a inter-party agreement in Greece about the need to change the combination of fiscal policy.

The 2019 budget includes some of the measures that were carried out under the Greek rescue program, Fitch notes, and # 39; Particularly refers to a reduction in pensions registered for 2019 and higher contributions for people independently. It also reduces corporate tax and property taxes. The budget affirms the level group's view that some of the individual changes are susceptible to the & # 39; dialogue with creditors in the official department. Fitch does not believe that this is a major change in fiscal policy. He confirms that the budget is over 3.5% of GDP targeting in 2019 (largely due to its own prejudice). The decrease in government debt and debt relief measures that have agreed to improve the operation of Finnish policies of Greece, featured in the two-stage reform of the country to BB – in August.

According to Fitch, Greece has a & # 39; making progress to attack the issues of rigorous rigor. He believes that there will be no funding problem in the country by 2022, which is a safety feature to prevent long-term financial risks. This will add to & # 39; organizational group, which helps to & # 39; marketing them confidence and access.

The efforts to accelerate the reduction in NPEs of Greek rods are shaped, and continuation group. NPEs include about 50% of ds; The overall deficiency of the four largest Greek banks: although their volume is declining, some of the overall vision remains constant as a result of the continued reduction in loan.

Economic revival, sales of NPEs, greater use of electronic connections and, to a lesser extent, settlements outside the court can be found by banks; achieving the NPE targets set by the SSM for 2021 (between 17% and 22%), Fitch said, but said it would not be difficult to speed up the speed of the NPEs so rapidly He is confident in the Greek banking system.

In the decision, the House is notes that parliamentary elections are due to take place before October 2019. However, the political country in the country has become more sustainable. As he says, there is a broad consensus that budget control must be maintained, as long as he says that the relationship between his / her; Greece and creditors of Europe have improved greatly. This, according to Fitch, is to reduce its & # 39; It is a danger that the government will have a big bridge in fiscal and economic policy in the future. However, he says that future Greek governments need to maintain a surplus for a long time, and there may be challenges.

It is noted that Fitch's following ratings are now on March 1st from Moody, April 26 with S & P and on 3 May with DBRS. The second round of sets for this year begins on August 2 with Fitch, on August 23 from Moody & on and on October 25 with S & P and November 1 with DBRS.

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