(Bloomberg) -- Greece is moving ahead with plans to deploy European Union recovery-fund cash, as the government seeks to revive the economy after the double blow of a decade-long debt crisis and the coronavirus.
Prime Minister Kyriakos Mitsotakis has created a steering committee to draw up detailed plans on how to make best use of 32 billion euros ($38 billion) from the EU's Next Generation program agreed this month. Greece is receiving funds worth more than 17% of gross domestic product, the highest among member states.
During 10 years of debt crisis, Greece lost almost a quarter of its GDP, and the government expects a further 8% decline due to the pandemic. The country's unemployment rate is still the highest in Europe and its debt level is expected to rise to around 200% of GDP this year.
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“In order not to lose a single euro, not a single minute must be lost,” Mitsotakis told ministers before a cabinet meeting Friday. The committee will begin its work immediately so that the basic plan is ready by the end of September and Greece can submit a national recovery plan to the European Commission on Oct. 15, he said.
Mitsotakis has won international praise for his handling of the Covid-19 crisis. He now has to show he can improve Greece's relatively poor record in making effective use of European funds and prove to some skeptical EU counterparts that taxpayers' money is not going to waste.
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The steering committee will have five teams that will work on how Greece can use the money in areas including environmental projects, digital reform, social cohesion and improving infrastructure.
Before the pandemic, the Greek government also asked a group of economists led by British-Cypriot Nobel Laureate Christopher Pissarides to develop a plan to transform the economy. The group submitted its initial report this month with 15 recommendations that Greece will now consider to develop plans for the European funds.
The recommendations include shrinking the tax burden for employees, initiatives to promote women in the labor market, switching to renewable energy sources to be aided by reducing transition costs, modernization of financial supervision and investor protection, and modifications to the social security system.
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