Greek industrial output shrinks sharply

The data released by the Athens-based national statistics office, ELSTAT, showed a massive 4-percent year-on-year slump in May, cutting short a strong three-month run of consecutive growth.

It was a glaring contrast to March, when industrial production grew 5.3 percent. Meanwhile, industrial production for all of last year was down 2.2 percent compared to 2013.

Manufacturing didn't fare much better, shrinking 2.7 percent in May compared to the same month a year earlier, and down from a high of 8.2 percent in March. Electricity production plunged 7.5 percent, while mining output suffered a crushing 15-percent drop.

Bleak outlook

The situation is likely to get worse before it gets better.

Spending has all but ground to a halt as Athens imposed tough capital controls earlier this month to prevent an economic collapse.

This came after the government failed to strike a deal with its international creditors by June 30 that would have extended Greece's financial lifeline. Prime Minister Alexis Tsipras is now scrambling to strike a last-ditch deal by Sunday, or face bankruptcy and a potential exit from the eurozone.

Looming over the negotiations are empty state coffers and an economy that officially stumbled back into recession after it shrivelled 0.2 percent in this year's first three months.

In a further sign of just how hopeless the situation has become for many Greeks, the EU's statistical office, Eurostat, on Friday reported that the country lost nearly one percent of its population last year.

Bucking a European trend, more than 90,000 people went looking for greener pastures outside the nation's borders, leaving behind an economy in which over one in four are unemployed.

Southern Europe bouncing back?

The sobering numbers make clear just how far Greece has fallen behind other European nations.

Also on Friday, Italy's statistics institute, Istat, announced that its recession-battered economy looked set for a better-than-expected recovery. Industrial production there rose 0.9 percent from April to May - the strongest monthly performance since April 2014 - prompting Economy Minister Pier Carlo Padoan to tweet, "Still a lot to do but we are going in the right direction."

Spain's statistical office, INE, had equally rosy figures to report earlier this week. The nation's industrial output had ballooned by 3.4 percent in May, it said, marking a strong comeback after years of painful austerity policies.

Neighboring France reported an equally impressive rebound, as output in May grew by 0.4 percent after a 0.8-percent drop in April, the Paris-based national statistics agency, Insee, said on Friday. Year-on-year, output was up by 2.8 percent..

pad/bk (dpa, Reuters)