Bloomberg News

Greece’s Recession Began Earlier Than Previously Thought

October 05, 2011

(Updates with Finance Ministry statement in fourth and fifth paragraphs.)

Oct. 5 (Bloomberg) -- Greece’s economy entered a recession a year earlier than previously thought and contracted less last year than initially estimated, according to revised data from the Hellenic Statistical Authority today.

Gross domestic product declined 0.2 percent in 2008, down from a previous reading of 1 percent growth, the Athens-based authority said in an e-mailed report. GDP shrank 3.2 percent in 2009, more than the previously estimated 2 percent drop, and fell 3.5 percent last year, less than a prior estimate that showed a 4.5 percent contraction.

The data, revised in cooperation with Eurostat, Europe’s statistics agency, mean Greece’s economy will contract for a fifth year in 2012, according to the country’s draft budget that forecasts GDP falling 2.5 percent next year after declining 5.5 percent in 2011. Greece’s Finance Ministry said the new figures don’t affect targets in the 2011 and 2012 budgets.

“The new data don’t impact on the fiscal goals for 2011 and 2012, which are defined in absolute terms and are the basis on which the draft 2012 budget was submitted to Parliament,” the Athens-based Finance Ministry said in an e-mailed statement.

The new data contained revised estimates for final consumption, gross fixed-capital formation on homes, and imports and exports of ships, the statistics authority said. On the basis of the new figures, the final deficit figure for 2009 was 15.7 percent of GDP, according to the Finance Ministry.

--With assistance from Maria Petrakis in Athens. Editors: Jeffrey Donovan, Jeffrey Donovan

To contact the reporter on this story: Marcus Bensasson in Athens at mbensasson@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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