Athens - Greeks are on average almost 40 percent poorer than they were in 2008, according to recent data, laying bare the impact of a brutal recession and austerity measures that the government may be forced to extend into next year.
Gross disposable incomes fell 29.5 percent between the second quarters of 2008 and 2013, statistics service Elstat said yesterday.
Adding in cumulative consumer price inflation over the same period takes the decline close to 40 percent.
Propped up by international aid since 2010, Greece is at loggerheads with its lenders from the EU and International Monetary Fund (IMF) over the size of its 2014 budget deficit.
The discrepancy has prompted talk that Athens, which has ruled out across-the-board cuts in wages or pensions, might have to adopt new austerity measures.
Spending cuts and tax hikes to meet the terms of its international bailouts, coupled with record unemployment, have eroded domestic consumption, which in Greece accounts for about three-quarters of gross domestic product (GDP), the biggest proportion of the 17 countries that share the euro.
Total workers’ compensation had fallen 34 percent since the second quarter of 2009, the data showed. Over the same period, the government slashed social benefits by 26 percent.
The statistics service said the deep economic malaise had also affected household savings rates, which fell 8.7 percent in the second quarter of this year compared with a 6.7 percent drop a year earlier.
Based on EU/IMF projections, Greece’s battered economy is expected to contract 4 percent this year before recovering modestly next year.
This would bring the total GDP decline from 2008 to 2013 to 25 percent, making it Greece’s worst peace-time recession. - Reuters