A motorbike ice-cream vendor smokes a cigarette as he waits for customers next to a beach on Salamina island, west of Athens, Monday, June 29, 2020.

-Thanassis Stavrakis

ATHENS, Greece (AP) — Greece’s central bank says the country could avoid a major recession if it makes good use of emergency EU support funds and does not suffer a major renewed outbreak of COVID-19, but the pandemic is likely to compound long-term financial problems.

In a 210-page report published Monday, the Bank of Greece said its main forecast for 2020 is for an economic contraction of 5.8% followed by a recovery of 5.6% next year and 3.7% in 2022. But if there is a second wave of COVID-19 and the economy does worse, GDP could shrink 9.4% in 2020.

The pandemic, it said, would reverse progress made on Greece’s major long-term problems, including high unemployment and public debt as well as the country’s huge stock of non-performing loans that only recently dropped to below 40% percent of the total.

The Bank of Greece said it expects a major drop in tourism revenue which topped 18 billion euros ($20.3 billion), about 10% of the country’s annual output. All Rights Reserved.