Waiting for Godot (a.k.a second quarter GDP)

By Antonis D. Papagiannidis

Greece’s embattled Statistical Office that had to get back its own (and the country’s) credibility and reputation following the “Greek Statistics” trauma  of the ten years ago is notoriously hesitant in publishing its data – even in provisional form. In this case, September is here, Eurostat has provided us since mid-August with GDP flash estimates for Euro area and EU GDP – down, respectively, by 15% and by 14,4% for the second quarter of 2020 – while the OECD estimates for its own (wider) area is for a 9.8% fall. For Greece, we will have to wait some more days.

Patience is warranted, if for no other reason because once Greek GDP is known even in provisional terms, then the debt to GDP ratio for the debt-crisis beleaguered country will be here for all to see. Since the very beginning of the crisis caused by the coronavirus pandemic, IMF and OECD estimates of the incidence to Greek debt were ominous; the psychological threshold of 200% of GDP was said to be soon crossed – with Greece second only to Japan (some 250% of GDP, but mainly in the hands of local institutional investors) and quite higher Italy (getting close to 165%).

Greek fiscal authorities, as well as the Bank of Greece expect the debt/GDP ratio to go no higher than 192% – just short of the fateful threshold. Since Greece would really like to access the markets once more for one more sovereign bond issue in the very next week “while the going is good” for something like 2 bn euros – possibly by re-issuing earlier 10- or 7- years’ paper – keeping the exact size of GDP fuzzy sounds a little less like a “Waiting for Godot” of Samuel Beckett situation (where Vladimir and Estragon look for some point to their own existence) , a little more like playing along with and media (if not with market) perceptions.