May 10 being suggested as the “milestone” for commencing phased lifting of restrictions

With the Coronation casting its shadow on Greek society and the economy, Prime Minister Kyriakos Mitsotakis is working out alternative intervention scenarios that will lead the country back to normalcy as soon as possible.

The overwhelming assessment by government officials, based on the views of experts, suggests that May 10 could be a “milestone” for the gradual relaxation of restrictive measures. The precondition, of course, is to verify the estimates for the decline of the virus since Easter and of course that there will be faithful observance in the medium term by all citizens of the restrictions that have been put in place.

Reports say the measures will be phased out, as has been the case. As it is typically mentioned, the model with capital controls will follow, since their complete and simultaneous removal can lead to a resurgence of the problem. According to the same sources, traffic restrictions will be terminated first. The re-opening of school units, shops and restaurants will be announced within a reasonable time. In the third and final phase, domestic and foreign air transport will be restored. 

As mentioned above, this is the key – and positive – scenario of work to take action, as other adverse parameters such as the “persistence” of the pandemic or the reappearance of the virus in the autumn cannot be ruled out.

Depending on the course of the coronavirus will also be the overall impact of the informal, but particularly broad ‘lockdown’ that the economy faces. Any resumption of activities suspended before the end of May and a partial bailout of the tourist season will limit the scope of the recession, but will also give the Treasury a breather.

It is indicative that each month that the current quo status is prolonged, a 2% recession is expected, and public liquidity will be under pressure from May. The prime minister proposes the need to protect the health and income of citizens, but will insist on seeking European solutions to respond to the sudden crisis triggered by the coronavirus. It is also indicative that it has taken the lead in the initiative of the nine Member States of the European Union that have called for a Eurobond. As Mr Mitsotakis’ associates report, despite the negative wall raised by German Chancellor Angela Merkel assisted by the Netherlands and Austria at – via videoconference – last Thursday’s Summit,

However, as stated above, Mr Mitsotakis does not intend to take “unilateral” actions, such as the use of the liquidity “pillow” proposed by SYRIZA. It is typically said that if the government makes such a move, the confidence it has built up in the markets and led to extremely low lending rates will immediately disappear and it will be a matter of time for the country to return to a memorandum. 

However, it should be noted that, according to government sources, three sets of measures have already been announced and are being implemented, with a total budgetary cost of € 4.7 billion, equivalent to 2.5% of GDP, well above the European average. . The corresponding European average is 2% of GDP. These measures are said to “aim to support the public health system, employment and income, as well as the liquidity of businesses, in the immediate future, in order to avoid massive padlocks and joblessness”.

It is also in the process of developing a new package that could reach up to 15 billion euros. In any case, the crisis of the coronavirus completely changes the data as the country goes into recession, but then there can be a dynamic reboot. In the light of this, and given that the effective management of the Evros tensions initially and, at this stage, the consequences of the pandemic, have sharply raised Mr Mitsotakis’ political holdings, opposition parties are gaining ground that the prime minister’s assessment may lead the country to early elections in the autumn. Based on this reasoning, Mr Mitsotakis could claim through a ballot box a “clean” four-year period, so that the effects of the crisis can be absorbed quickly and then ensure the dynamic recovery of the Greek economy.

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