Greek Economy Grew in Second Quarter

Greece has repeatedly complained that the austerity measures demanded by its creditors-the EU, the European Central Bank and the global Monetary Fund-in return for two previous bailouts have only hurt an economy which has contracted by a quarter since the crisis broke.

In the first quarter, Greece reported flat growth instead of the 0.2-percent contraction previously announced.

The cash-strapped country’s gross domestic product (GDP) grew 0.8 per cent in the three months to June, completely smashing economists’ expectations for a 0.5 per cent contraction.

No official data was provided on what drove the growth as these are preliminary figures. “This explains the surprising second quarter GDP reading”.

In year-on-year terms the Greek economy grew even more, at 1.5 percent.

Until these latest figures were released, the economy had been forecast to shrink again this year by between 2.1% and 2.3%.

However, the report covers the period that came immediately before the imposition of capital controls, in which Greek banks and the stock exchange were shut down.

The news came as a rare ray of light for the debt-swamped eurozone country, as its parliament prepares to vote today on a new 85 billion euro (USD 94 billion) bailout deal with worldwide creditors – its third rescue plan in half a decade.

He said there were a number of sectors likely to have helped boost activity: “Some economic activity indicators in the second quarter, including consumption, industrial production and tourism, had shown particular resilience”.