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The Crisis and the Greek Economy: Assessment of sectoral performance, with focus on small and medium-sized enterprises

The aims of the present study are the assessment and ranking of the performance of the 50 most essential sectors of the Greek economy based on the fundamentals of Small and Medium-sized Enterprises (SMEs).


At the same time, the intertermporal examination allows us to identify:
  • the sectors with the strongest Positive Dynamics (in terms of improving their evaluation from 2007 to 2011), as well as,
  • the sectors with Declining Prospects (based on the decline in their evaluation from 2007 to 2011)
Finally, and perhaps most importantly, we present the impact of the prolonged recession on the fundamentals of Greek SMEs in all sectors.


Key findings and conclusions
  • The performance of all sectors has undergone significant and systematic deterioration between 2007 and 2011
  • In this context, the sectors that have suffered the smallest losses are the ones which have managed to improve their relative position in the scale of sectoral evaluation
  • Naturally, these sectors are the most defensive sectors of the Greek economy
  • Conversely, cyclical sectors – and particularly sectors that depend on private consumption – record the biggest drops and occupy the last positions.

Best in Class (BIC) Index
The main analytical tool with which we assess and rank the sectors is the BIC Index. First, the performance of each sector of economic activity is evaluated along four axes, which summarize the key dimensions measuring entrepreneurial activity, namely liquidity, efficiency, capital structure and correlation with the macroeconomic environment. Then – to facilitate the drawing of robust conclusions – the four axes are used to compile an overall sectoral performance index, which is referred to as the Best in Class (BIC) Index.

BIC Index: the 10 sectors with the strongest performance, 2011
Defensive sectors include utilities, such as water, wastewater management (E), electricity (D) telecommunications (61) and health (P). The real estate sector (68) is favoured disproportionately by significant liquidity. Sectors such as repair and installation of machinery (33) and manufacture of electrical equipment (27) benefit due to their strong capital base. In the current unfavourable economic climate, efficiency and profitability are reduced even in the sectors with strong performance.

BIC Index: the 10 sectors with the weakest performance, 2011
All of the sectors that occupy the last positions in our analysis are sectors of cyclical activity, as their activity is dependent on disposable income and household consumption. The sectors with the weakest performance face challenges in terms of profitability and efficiency, and are behind in terms of liquidity. The sectors that best illustrate this behaviour are film production and broadcasting (59+60) and the manufacturing of PCs (26).

Ascending sectors
Ascending sectors, such as telecommunications (61) are based on high liquidity or on their high capital base, e.g. air transport (51).
On the other hand, sectors such as the manufacture of petroleum products (19) and agricultural production (A) produce basic goods and rely on external demand, while their prices are influenced by international factors. Moreover, due to the nature of their products, their demand is largely inelastic.

Descending sectors
The sectors with the biggest declines are associated with the industries of building and public projects e.g. construction (ST) and mining-quarrying (B), with cutbacks in public expenditure e.g. drugs (21) and with reductions in private expenditure e.g. publishing activities (58).