Mitsotakis at debate: After pandemic, energy crisis Greece obliged to produce primary budget surpluses

The first – and possibly only – debate between Greek party leaders on Wednesday evening, ahead of the May 21 election, generated some tangible news on the economic front from answers given by incumbent Prime Minister Kyriakos Mitsotakis.

The leader of the center-right New Democracy (ND) party, which is leading main rival SYRIZA party in all mainstream opinion polls, referred to a “new economic model” after the election. Although easily leading in the first-past-the-poll race, a simple representational system in place for the May 21 means the top vote-getter party needs a larger percentage of the vote to form a government. Otherwise, a coalition government will have to be worked out, or, a second election in a few weeks’ time is possible.

Mitsotakis also touched on a warning by Bank of Greece (BoG) Gov. Yannis Stournaras, who cautioned that little or no “fiscal space” exists to fund any of main parties’ pre-election spending pledges.
Queried over the costly subsidies allocated to ameliorate skyrocketing electricity bills over the past year and a half, which have reached 13 billion euros, as well as 43 billion euros in support measure during the pandemic, he said:

“Over recent years we had exceptions to EU rules, that’s why we supported the economy and the citizens…We kept society standing, rescued businesses and protected households from energy hike,” the Greek premier said, adding however:

“From now on the economic policy changes: From now on, the country is obliged to produce primary surpluses, and this is hugely important for the investment grade,” Mitsotakis replied, in response to what he’s criticized as SYRIZA’s free-for-all spending promises.

Among others, Mitsotakis, in power since July 2019, said the leftist main opposition party’s campaign promises, if implemented will lead to bankruptcy.