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EU Says Greek GDP to Shrink 4.4 Percent in 2012 as Prices Fall

February 24, 2012

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Feb. 23 (Bloomberg) -- Greece’s economy will go through deflation this year as gross domestic product falls 4.4 percent, the nation’s fifth straight year of recession, according to the European Commission.

Greece’s harmonized consumer-price index will decline an average 0.5 percent this year, after increasing an average 3.1 percent in 2011, the European Union’s Brussels-based executive arm said in an e-mailed statement today.

Greece’s economy contracted 6.8 percent last year and 3.5 percent in 2010. In November, the commission forecast the Greek economy would contract 2.8 percent this year.

Euro-area finance ministers on Feb. 21 approved a new loan package for Greece and private-sector debt restructuring to reduce the country’s debt load to 120.5 percent of GDP by 2020. Greek debt as a proportion of GDP will top 169 percent last year, according to legislation sent to parliament on Feb. 21.

--Editor: Jeffrey Donovan

To contact the reporter on this story: Marcus Bensasson in Athens at

To contact the editor responsible for this story: Craig Stirling at

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