Springtime for Greece meant closed companies

Elstat data show the extent of the losses for businesses as the lockdown took effect

Greece’s statistics agency Elstat is having a good crisis, producing timely data to help us get a handle on how coronavirus is impacting the economy.

Its chief innovation is a monthly release showing the hit to companies’ turnover. So we know that revenue for all Greek companies fell 2.9 percent in the first quarter compared with the same period of 2019, and that 206,000 companies had to suspend operations. That’s 15 percent of the total.

For most Greek companies the data available right now only runs to March. But larger companies, which account for about 85 percent of overall turnover, are required to submit information monthly. These companies showed a 32 percent drop in revenue in April, the most recent month available, compared with 2019. For the ones that suspended operations the drop was 80 percent.

In Wednesday’s newsletter, we noted that the fiscal cost to the central government of the coronavirus through to the end of May was about 5 billion euros. The scale of the hole in the economy that deficit has to plug becomes apparent when we see that for larger companies revenue dropped by 8.8 billion euros in March and April alone.

There’s a lot of interesting detail in the release, so it’s one this newsletter is likely to come back to. But I’ll leave off with a chart showing which sectors saw the biggest drops in revenue in April (only counting ones with a turnover of 300 million euros or more in April 2019).

Elsewhere on the web

  • EU leaders today look set to show the world once more that there are no decisions so urgent they can’t be put off longer. Faced with stiff opposition to the European Commission’s budget plan from the so-called “frugal four”, German Chancellor Angela Merkel now sees an agreement “before the summer recess”.

  • Speaking of the Recovery Fund plan, Zsolt Darvas over at Bruegel points out that more of it should be spent sooner. And Politico has a nice infographic with some of the numbers under discussion.

  • We started the week with a look at the importance of Greek tourism for the economy. The bad news is that it could take until 2025 for it to recover to last year’s level, according to an EY report. They’ve written about other sectors too.

  • At some point this newsletter will touch on the subject of industrial policy. Until then, here’s an article setting down some economic foundations. Although written with the US in mind, the arguments are relevant for Greece too.

  • One day this newsletter will also write about the Greek connection at the Levy Institute, which played a support role in Modern Monetary Theory’s rise to its current visibility in policy debate across the Atlantic. Anyway, the institute has a policy brief on prospects for Greece after the coronavirus.

I’d love to get your thoughts and feedback in the comments or on Twitter. If you’d like to read more posts like this, consider subscribing to the newsletter.