|Angela Merkel, German chancellor, praised the reforms being implemented in Greece, when she met Antonis Samaras, Greek prime minister, in Berlin, Nov 22, 2013.|
The Organisation for Economic Cooperation and
Development (OECD) said on Wednesday that an 11-month investigation by the
think-tank for 34 mainly developed countries in cooperation with the Greek authorities
has identified a wide range of regulations and legal provisions that undermine
In its report into Greece’s food processing, retail trade, building materials
and tourism sectors, the OECD identified 555 regulatory restrictions which it
says, if lifted, would have major benefits for the Greek economy, not least
through lower prices. The OECD said separately that serious consideration
may have to be given to cutting the country's debt burden again.
Assessment Review of Greece makes
more than 320 recommendations on legal provisions that should be amended or
repealed. The report says the Greek authorities have taken important steps in
recent years to reinforce competition law, strengthen the Hellenic Competition
Commission and liberalise professional services.
A competition assessment “toolkit”, developed by the OECD, was used to structure
the analysis. It provides a checklist that guides the assessment of laws and
regulations to identify crucial restrictions to competition.
The report argues implementation of the report’s recommendations would lead to
substantial benefits for Greek consumers, and help remove barriers to growth. It
estimates the benefit to the Greek economy would be around €5.2bn - - the
equivalent of 2.5% of GDP - due to increased purchasing power for consumers and
efficiency gains for companies.
Implementing the recommendations would have an even wider impact over time, the
report says. OECD studies demonstrate that the removal of barriers to
competition in a number of markets across the wider economy will lead to
increased productivity and hence stronger economic growth and job creation.
The main findings include:
to entry (such as the definition of “fresh” milk which sets the maximum
shelf-life at five days, exclusive distribution of over-the-counter medicines (OTCs)
by pharmacies, minimum requirements for touristic infrastructures and
distortions (such as regulated prices of OTCs, requirements to submit prices to
trade associations and various forms of price notification and approvals);
that constrain the operation of businesses and their commercial practices (such
as the regulation of promotions and sales, restrictions on the establishment and
ownership of pharmacies);
levies (such as the levy on cement, on the wholesale price of medicines and on
legislation (such as various provisions in the Code of Foodstuffs and Beverages,
including restrictions on bottling apple vinegar or importing certain types of
The OECD also said on Wednesday that Greece has
made impressive headway in consolidating its public finances and undertaking key
structural reforms to boost productivity and enhance competitiveness.
In its latest
Economic Survey of Greece, the OECD says the crisis has been much deeper
than expected, leading to a sharp contraction in activity that has pushed
unemployment up to almost 28% of the labour force, created hardship for
vulnerable social groups, and is posing risks to the sustainability of the
country’s government debt.
Presenting the survey in Athens, Angel Gurría, OECD
secretary general, said:
“For the reform efforts to succeed and be accepted by citizens, it is imperative
that both the costs and the benefits of adjustment are shared fairly.”
He acknowledged that the country’s government debt trajectory has worsened as
a result of slower-than-expected growth, despite the 2012 restructuring.
“If Greek growth again disappoints, or deflation persists
- - even after the
implementation of structural reforms -- then it will be extremely difficult to
reach the debt-to-GDP target of 120% by 2020. In this case, serious
consideration should be given to reducing the current debt burden,” he said.
The survey says accelerating and broadening the structural reform programme
is essential for a sustainable recovery. It says privatisations should be
speeded up, particularly in the energy sector and in railways, regional
airports, ports and real estate.
The report recommends better targeting of benefits, including a minimum
income scheme, to strengthen the safety net. Health care cuts must focus on
further reducing inefficiencies while safeguarding cost-effective and critical
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