Greek economy likely to shrink 3 pct in Q3 - finance minister

Reuters

ATHENS, Oct 21 (Reuters) - Greece's economy is likely toshrink by about 3 percent in the third quarter, Finance MinisterYannis Stournaras said on Monday, easing from 3.8 percent in theprevious quarter after a revival of tourist revenues.

Such a reading would indicate that the economy, which is inits sixth year of recession, would shrink by about 4 percentthis year, in line with forecasts by the government and thecountry's international lenders, the European Union and theInternational Monetary Fund.

"The Greek economy is certainly entering a new phase,"Stournaras said during a tourism conference in Athens.

"We expect an even better result in the third quarter,probably close to -3 percent, a result in which tourism hascertainly contributed significantly."

The Mediterranean country has pinned its hopes on tourism,which accounts for about a sixth of economic output and employsnearly a fifth of the country's shrinking workforce, to exit thedeep financial crisis.

Stournaras said that in the first eight months of the yearforeign tourist arrivals rose by about 15 percent and nettourism receipts by about 18 percent year-on-year.

Tourism officials see a 10 percent revenue rise in 2013, to11 billion euros, on the back of more than 17 million visitors.

Greece has been kept on a drip feed of EU/IMF rescue loanssince 2010 that have come at the price of austerity cuts andAthens has repeatedly ruled out imposing painful new measures.

The government is aiming for a primary budget surplus of 0.2percent of GDP this year, in the hope of further debt relief byits international lenders.

It also expects the economy to grow by about 0.6 percent in2014, which would be the first year of growth since 2007.

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