Governor of the Bank of Greece: "We don’t have enough money to fulfill all the campaign promises"

Bank of Greece Governor Yiannis Sturnaras put an end to ambitious campaign statements and financial promises from several political parties, including the ruling New Democracy.

At the same time, he indirectly intervened in the election campaign in favor of the ruling New Democracy, which aims to be the winner of the May 21 elections, able to avoid a coalition government. “We don’t have enough budget funds to fulfill all the election announcements,” Sturnaras said on Wednesday.

In an interview with the Imerisia newspaper, he warned that the Greek budget does not have enough money to implement the pre-election statements of political parties. “Of course, I understand that before the elections it is customary to talk about things that cannot be implemented. And if we correctly evaluate everything that is said, then we will far exceed any available fiscal space,” the head of the central bank said.

Speaking about the “investment rating” of Greece, he said that the rating agencies will make their decision after listening to the political program of the new government. He added that it would be better if a stable government with a long-term horizon takes all the decisions necessary to obtain an investment rating and decisions that will be included in its political program.

Sturnaras said the economy is on the right track, but the country needs confirmation of sound economic policies for the coming years and definitely needs a stable government. He added that the cycle of interest rate hikes is coming to an end, but stressed that we have not yet reached their end. “We cannot say how many more hikes there will be. It will depend on estimates of inflation, economic growth and financial conditions. At the current state of affairs, and if there is nothing dramatic ahead, we can say that during 2023 interest rate hikes will end “, Sturnaras said.

The head of the central bank assured that Greek banks are well capitalized, enjoy good liquidity, have strict oversight and often undergo extreme stress tests. He said there was little chance that something could happen to Greek banks.

On May 10, a series of pre-election debates took place on the main television channels in Greece, in which the leaders of the main parties presented their programs.

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