GR US

Mitsotakis Says He Rescued Greece's Battered Middle Class

Ευρωκίνηση

Prime Minister Kyriakos Mitsotakis. (Photo by Eurokinissi/ Dimitris Papamitsos)

ATHENS - Prime Minister Kyriakos Mitsotakis said he has kept a vow to help Greece's middle class which he said had been beset upon by the former ruling Radical Left SYRIZA with a tsunami of taxes.

“I had promised that I would return to the middle class what SYRIZA took from it and this government is implementing this pre-election commitment,” Mitsotakis said during a speech in northern Greece, referring to tax cuts he said his New Democracy government will make.

“Despite the pandemic and the crisis, this government is consistent in implementing its promise,” he added, stressing that Greece “is absolutely ready to make the big leap in the future,” reported Kathimerini.

That was in reference to COVID-19 still sweeping the country, the health crisis a setback to Greece's slow recovery from a near decade of harsh austerity measures attached to 326 billion euros ($394.37 billion) in three international bailouts that ended Aug. 20, 2018.

“Standard & Poor’s upgraded the Greek debt with a positive outlook for the future, thus certifying the confidence that international investors show in the outlook of the Greek economy,” he noted.

He said his government's national recovery plan – with the European Union pouring in 32 billion euros ($38.71 billion) in COVID-19 loans and grants for current relief – would bring hundreds of projects in the coming decades.

Those, he said, “Will reshape the production model, the image, but also everyday life throughout the country.” His government also is introducing a lower corporate tax rate that was hiked to 29 percent by SYRIZA, which has hard-core anti-business elements.

Under SYRIZA, Greece's middle class was deliberately targeted to pay higher taxes in the Leftists plan to redistribute the wealth and they were hit hardest by big pay cuts, tax hikes, slashed pensions and unemployment.

The so-called National Recovery and Resilience Plan, called Greece 2.0, envisions how the country can come back when, or if, the pandemic ends, even as cases, deaths and people in critical condition are still rising.

In March, Mitsotakis unveiled a 57-billion euro ($68.95 billion) scheme of170 projects, investments and reforms optimistically said to increase growth by 7 percent over six years, after the economy has shrunk some 9 percent or more.

The turnaround, including growth outside the plan’s incentives, would also create 200,000 jobs he said and will bring a “paradigm shift around a more outward-looking economy and a growth-inducing tax system.”

There were few details how it would be achieved or if it includes further aid to the country’s battered businesses, especially restaurants, bars, taverns, caterers and a food sector under siege by lockdowns.

It does include, said Kathimerini in a report, an energy upgrade of the country’s building stock with state subsidies, modernizing professional education and training, and further digitization.

One of the keys is a fifth generation (5G) mobile network on highways and the digital interconnection of islands, urban renovations such as those at Elaionas and Tatoi in Attica, and digitalization of the state’s archives.

But not included would be construction of highways, except for a road across northern Crete and the E65 highway in central Greece, the overall plan financed by 18.2 billion euros ($22.02 billion) from the Next Generation European Union fund and 12.7 billion euros ($15.36 billion) in EU loans.

“This constitutes a fundamental economic and social transformation,” the government statement said, based on four main pillars, in accordance with the guidelines of the European Commission, environment, digital, employment and economic transformation, with few specifics.

"The National Plan has a groundbreaking character, because it changes the model to create an open economy and a tax system that is friendly to growth and always focused on the future," the prime minister said, adding: "Hence its name, Greece 2.0. The National Plan seeks to create many new and well-paid jobs. However, together with the resources of the plan, private citizens are invited to add their own funds, taking the associated risk," Mitsotakis noted.

"The National Recovery Plan creates a new daily life for all citizens," he also said then.