Think tank sees Greek 2019 growth at 1.8%, picking up next year

Credit: REUTERS/ALKIS KONSTANTINIDIS

Greece's economy will expand by up to 1.8% this year and pick up next year, stimulated by exports and investment, the country's influential think tank IOBE said on Thursday, sticking to its previous forecast.

ATHENS, Oct 24 (Reuters) - Greece's economy will expand by up to 1.8% this year and pick up next year, stimulated by exports and investment, the country's influential think tank IOBE said on Thursday, sticking to its previous forecast.

The projection by the Foundation of Economic and Industrial Research (IOBE) in its quarterly review is roughly in line with the government's 2% estimate for this year. IOBE also projected an expansion rate of 1.8% for this year in its July report.

Greece's 180 billion euro economy is recovering from a multi-year recession and has largely corrected the imbalances of its twin deficits - its fiscal derailment and the current account gap.

It grew 1.9% in 2018, the year the country emerged from its third and last bailout. The government, which came to power in July, is keen on accelerating growth via promised tax cuts and investment-friendly policies.

IOBE said economic expansion will pick up to 2.3-2.5% next year thanks to those policies, exports and planned privatisations. Athens sees the economy growing 2.8% in 2020.

The country's gross domestic product expanded by 0.8% in the second quarter compared with a 0.2% growth rate in the first three months of the year.

IOBE also said an expanding economy will create more jobs and help reduce unemployment, which currently stands at 16.9% and is the euro zone's highest. The jobless rate is seen dropping to 15.6% next year, it said.

(Reporting by Angeliki Koutantou Editing by Chizu Nomiyama)

((george.georgiopoulos@thomsonreuters.com; +30210 337 6437; Reuters Messaging: george.georgiopoulos.thomsonreuters.com@reuters.net))

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