Greek Economy Set to Grow as Tourists Flock The Nation

The Greek economy may grow more than expected as tourists return to the country in greater numbers, according to the central bank chief.

An expansion of “3.2% is our baseline scenario at the Bank of Greece, but this is based on the assumption that revenues from travel, from what we call tourism, is going to be 80% of the revenues of 2019,” Yannis Stournaras said in an interview Saturday. “It seems to be that it is going to be close to 100%. So 3.2% perhaps is on the lower end of the probability distribution.”

The tourism sector is vital for Greece and the industry accounts for about a fifth of its economy and more than a quarter of jobs. While a cost-of-living crisis means European consumers have cut back on some spending, foreign travel has proven an exception and tourists are flocking to Greece.

The country also is in a better situation than some of its euro-area peers in regard to the threat of Russia cutting off energy deliveries. Greece will likely avoid a recession should shipments halt completely, Stournaras said.

“Greece has quite diverse sources of natural gas, of liquefied natural gas — it has done its homework for many months now,” he said. A complete stop would mean “the growth rate falls a lot, but it does not become negative,” he said. “We’ll not fall into recession.”

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