The return to normality after the disruption caused by the pandemic marks 2021 and 2022 in trade relations between Greece and Germany, with the two countries expanding their close and privileged trade relations, with Germany remaining in first place as a nation state as an investor for Greece, with total net direct investment of 6.8 billion euros and a share of 18.3%.
This image is strengthening despite the turbulence caused by inflationary pressures in trade, as a result of which trade flows between Greece and Germany continue to show positive signs of change in real terms.
According to a study by the IOBE Foundation for Economic and Industrial Research titled “The contribution of bilateral economic relations with Germany to the Greek economy in 2021”, which was prepared with the support of the Hellenic-German Chamber of Commerce and Industry and presented today at a joint online event, in 2021. the total amount of funds from direct investments of legal entities and individuals resident in Germany in Greece increased to 6.8 billion euros compared to 5.6 billion euros in 2020. Thus, after the decline in 2020, the volume of direct investments is approaching the level of 2018 G.:
- Germany ranks first in the ranking of countries of origin of direct investment in Greece in terms of total funds for 2021, with 6.8 billion euros and a share of 18.3%. It is followed by Luxembourg (6.6 billion euros), the Netherlands (6.2 billion euros) and Switzerland (3.0 billion euros).
- The export of Greek products to Germany in 2021 reached 2.8 billion euros, an increase of 21% compared to 2020, and in 2022 it increased to 3.4 billion euros. The value of product imports from Germany to Greece was 6.9 billion euros in 2021 (+18.3% yoy) and 8.0 billion euros in 2022. As a result, the trade deficit in goods in bilateral trade between Greece and Germany increased to 4.1 billion euros in 2021 and 4.9 billion euros in 2022.
- In services, Greece is posting a multi-year bilateral trade surplus (€1.8 billion in 2021 and €2.3 billion in H1 2022) as German revenues are maintained at a much higher level than payments for services to Germany (3.2 billion euros vs. 1.4 billion euros respectively in 2021 and 3.7 billion euros vs. 1.3 billion euros respectively in the first half of 2022).
Scope of activities of the Greek-German Chamber
Meanwhile, from the analysis of the study data, conducted on an expanded sample of member companies of the Hellenic-German Chamber, it follows, in particular, that:
- The total effect of the sample activities in 2021 in terms of GDP, taking into account the activities of companies, as well as the investment program they have implemented, is estimated at about 6.8 billion euros or 3.8% of GDP.
- The government revenues of the state from taxes and contributions arising directly from the regular activities of the above companies are estimated at 544 million euros, of which 118 million euros are employer contributions, and taking into account indirect and induced effects, tax revenues and contributions in 2021 are estimated at 1.2 billion euros.
- In terms of employment, the companies participating in the survey contribute 65,000 jobs, of which 22,800 are directly occupied by member companies.
- Each increase in the gross product produced by member companies by one euro results in an increase in the GDP of the Greek economy by 1.4 euros, with a corresponding multiplier of 1.7 in terms of employment. Taking into account the induced effects, the overall GDP multiplier is 1.5. Thus, for every euro of the direct contribution of the member companies, there is a corresponding 1.5 euros of the total contribution to the GDP of the Greek economy.
- The corresponding multiplier for employment is 2.3, i.e. each worker in the member companies of the chamber has a total contribution to employment equal to about 2.3 jobs at the national level. Equivalent to each position created in participating companies, at least 1 position is opened in other sectors of the economy.
The study was presented by the Head of the IOBE Microeconomic Analysis and Policy Department, Mr. Svetoslav Danchev, and the IOBE Director General, Professor of the Athens University of Economics, Mr. Nikos Vetta, delivered an opening speech and comments.
Secretary General of Private Investment and Public-Private Partnerships (SDIT) Mr. Orestis Kavalakis, placing itself in the context of the event of the Hellenic German Chamber and IOBE, emphasized, among other things, that from July 2019 to date, 36 new strategic investment plans with a total budget of more than 8 billion euros have been approved, while in the context of the new Development Law in The first two modes of production and tourism are included in the first 401 applications for a total amount of more than 1 billion euros and in the second 562 applications for a total amount of 1.6 billion euros. Regarding PPPs, Mr. Kavalakis highlighted that 47 projects with a total budget of €7.1 billion have been approved, of which 36 have been approved since July 2019. With regard to the transition to equitable development, the Secretary General of the Ministry of Development noted that Greece received the first approval,
Director General and Member of the Board of Directors of the Hellenic German Chamber doc. Athanasios Kelemis, opening the event, stressed, among other things, that “Germany is considered an important strategic investment partner for Greece. He placed funds in key sectors of the national economy, the most characteristic of which are telecommunications, new technologies and the energy market.” As Mr. Kelemis noted, “Germany not only provides Greece with capital flows. Much of the investment is accompanied by the transfer of high-quality technology and experience, and it is important for a country like Greece to build a technological reputation from every investment step.”
IOBE CEO Prof. Nikos Vettas emphasized that “the study focuses on two critical conditions for the Greek economy, the increase in exports and investment, which are favorable in the context of economic relations between the two countries, which are on a positive course both quantitatively and qualitatively.” As he noted, “it is important that a course be taken to strengthen Greece’s trade and investment relations with Germany and other major partners, with an emphasis on the technological content of investments and the qualitative renewal of exports.”
More Stories
Bank of Greece: total reduction in bank deposits
"Easter basket" will appear on shelves from mid-April, what will it include
Who will receive a voucher for 300 euros