Opinion

Integrity of official statistics under threat

Andreas Georgiou has unwittingly become an international icon for statistical integrity. His continuing politically-motivated persecution is highly damaging for Greece, and more broadly for the credibility and reputation of the euro area.

By: and Date: August 10, 2018 Topic: European Macroeconomics & Governance

This opinion piece was also published in:

Andreas Georgiou, former head of the Hellenic Statistical Authority (ELSTAT), has become the public face of the global threat to the integrity of official statistics and statisticians. The facts of the case are well known. The International Statistical Institute, the American Statistical Association and multiple regional statistical bodies have decried the threat in their expressions of support for Georgiou. A recent petition collected over a thousand signatures, including from nine Nobel laureates in economics.

Georgiou has been convicted for “violation of duty” for not submitting ELSTAT’s final figures on the 2009 budget deficit for approval by a politically appointed board. Given what is known of the views held by that board’s members, seeking its approval would surely have led to misleading figures. Instead, he followed the European Statistics Code of Practice, which assigns “sole responsibility” to heads of national statistical institutes (NSIs), such as ELSTAT, for their data production and dissemination. The appeals court conviction, upheld by the Supreme Court, ignored the fact that the European Statistics Code of Practice had been explicitly endorsed under Greek law before Georgiou took up his post. The irony is that successive Greek governments, while claiming to stand aside from the prosecutions of Georgiou, have used the same figures and statistical methodologies to justify financial support and now debt relief from their European partners. Unfortunately, European leaders have largely refrained from bringing pressure on Greek politicians to stop damaging the reputation of Greece and the European Union.

Reliable official statistics are essential building blocks of sound economic policy. Budget projections inevitably contain a combination of revenue and expenditure estimates and a dose of politics. Budget outcomes, as recorded in official statistics, however, are different. They must be accurate and above suspicion of political manipulation. They are crucial to the transparency and democratic accountability of governments. They are critical to the functioning of market activity, saving and investment, and thus to growth, employment and prosperity. Concerns about political manipulation of statistics are especially relevant for the euro area, where joint economic policies rely critically on the accuracy of national statistics on economic growth, budget outcomes, and sovereign debt, which are aggregated (but not compiled) by Eurostat, a department of the European Commission.

Moreover, prudent lenders in international financial markets rely on the integrity of national statistics to make investment decisions; less confidence in that integrity translates into higher borrowing interest rates for the government as well as the private sector. The case of past inflation statistics in Argentina illustrates the damage that politically motivated statistical manipulation can do to a country’s international reputation and access to markets, as well as to its economic prospects more broadly.

Georgiou’s case exposes the inadequacy of the existing safeguards in Europe’s policy on official statistics. The EU system is failing the most basic test of its ability to deter political pressures on official statistical production, with potential chilling effects on official statisticians in other member-states and more widely in countries around the world. For example, the process for compiling the all-important decennial census in the United States is in danger of political manipulation by the addition of a question about citizenship in the 2020 census, which could discourage non-citizens from participating. Everywhere, a major source of potential political pressure on statistical agencies is via constraints on their budgetary funding, which is controlled by national parliaments.

The multiple criminal and civil prosecutions against Georgiou have already damaged Greece’s international reputation by raising doubts about its sustained capacity and willingness to produce reliable official statistics. Greece will feel consequences if it seeks to return to international markets without reversing this damage. More broadly, Greece will not achieve the long-lasting growth, stability and prosperity that it wants without establishing trust in its official statistics, which cannot be achieved as long as Georgiou’s persecution continues.

The damage extends beyond Greece. EU leaders and institutions have underestimated how much the case of Georgiou is harming the reputation of the euro-area policy framework, which relies heavily on economic statistics from its member-states. The persecution of Andreas Georgiou must end. And Greece and the EU must ensure that similar cases never happen in the future.


Republishing and referencing

Bruegel considers itself a public good and takes no institutional standpoint.

Due to copyright agreements we ask that you kindly email request to republish opinions that have appeared in print to communication@bruegel.org.

View comments
Read article More on this topic More by this author

Blog Post

Non-performing loans’ legacy versus secondary markets

Eleven years since the start of Europe’s financial crisis, and the legacy of non-performing loans in the EU, though much smaller, is still a live issue for some member states.

By: Joanna Surala Topic: Finance & Financial Regulation Date: December 10, 2019
Read article Download PDF More on this topic More by this author

Policy Contribution

The European Union-Russia-China energy triangle

Concern is growing in the European Union that a rapprochement between Russia and China could have negative implications for the EU.

By: Georg Zachmann Topic: Energy & Climate Date: December 9, 2019
Read article More on this topic More by this author

Opinion

Europe can take a bigger role in providing public goods

The EU should invest where it can deliver more value than member states acting alone.

By: Jean Pisani-Ferry Topic: European Macroeconomics & Governance Date: December 5, 2019
Read article More by this author

Blog Post

Bank regulation in the European Union neighbourhood: limits of the ‘Brussels effect’

The EU model of financial market regulation is increasingly copied by third countries. In this context, the EU’s efforts to promote its model beyond its borders should take into account the underdevelopment of financial markets in many partner countries, and the often insufficient capacity of regulators and supervisors.

By: Alexander Lehmann Topic: European Macroeconomics & Governance, Finance & Financial Regulation Date: November 20, 2019
Read article Download PDF More on this topic

Working Paper

The state of China-European Union economic relations

More can be done to capture the untapped trade and investment opportunities that exist between China and the EU. China’s size and dynamism, and its recent shift from an export-led to a domestic demand-led growth model, mean that these opportunities are likely to grow with time.

By: Uri Dadush, Marta Domínguez-Jiménez and Tianlang Gao Topic: Global Economics & Governance Date: November 20, 2019
Read article More on this topic

Blog Post

China’s growing presence on the Russian market and what it means for the European Union

The European Union’s relationship with Russia is strained, but the two economies are nevertheless highly intertwined. A huge share of Russia’s exports go to the EU, while in the early 2000s, EU countries supplied more than half of Russia’s imports. The EU is also a major investor in, and lender to, Russia.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: November 6, 2019
Read about event More on this topic

Past Event

Past Event

Bank resolution: consistency and predictability

Closed-door workshop on various aspects of bank resolution.

Speakers: Rebecca Christie, Jon Cunliffe, Martin J. Gruenberg, Elke König, Pamela Lintner, Martin Merlin, Maria Velentza, Nicolas Véron and Guntram B. Wolff Topic: Finance & Financial Regulation Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: October 29, 2019
Read article More on this topic More by this author

Opinion

Europe: en finir avec la politique en silos

Projetée dans un monde de rapport de force dont les principaux protagonistes ne séparent pas géopolitique et économie, l’UE va devoir conduire un changement de logiciel culturel, une mutation organisationnelle et un rééquipement opérationnel, explique l’économiste Jean Pisani-Ferry.

By: Jean Pisani-Ferry Topic: European Macroeconomics & Governance Date: October 8, 2019
Read about event More on this topic

Past Event

Past Event

A fresh perspective on EU-Turkey relations: still a possibility?

Examining the mutual benefits of a EU-Turkey customs union.

Speakers: Zeynep Bodur Okyay, André Sapir, Sinan Ülgen and Guntram B. Wolff Topic: European Macroeconomics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: October 3, 2019
Read article More on this topic More by this author

Podcast

Podcast

Deep Focus: What's slowing the Mercosur agreement?

The EU-Mercosur has been 20 years in the making, but a hostile trading environment, unpredictable government and growing environmental concerns are putting it in peril. Is the deal worth fighting for and can it be saved? And could it become a casualty Brazil's forest fires?

By: The Sound of Economics Topic: Global Economics & Governance Date: September 27, 2019
Read article More on this topic More by this author

Blog Post

Modernising European Competition Policy: A Brief Review of Member States’ Proposals

French, German and Polish governments have jointly proposed options for modernising EU competition policy. The debate to recalibrate European competition rules was already well underway. So, it is not surprising that proposals are consistent with other statements made by France and Germany. Yet, proposals do not address current issues weighing on the international competition community, such as conglomerate effects theory or algorithmic collusion.

By: Mathew Heim Topic: Innovation & Competition Policy Date: July 24, 2019
Read article More on this topic

Opinion

EU policy recommendations: A stronger legal framework is not enough to foster national compliance

In 2011, the EU introduced stricter rules to monitor the implementation of country-specific policy recommendations. Using a new dataset, this column investigates whether these new laws have increased national compliance. There is no evidence that these stricter processes matter for implementation rates, whereas macroeconomic fundamentals and market pressure are important determinants of implementation progress. These results suggest ways to improve the effectiveness of European policy coordination that go beyond stronger legal processes.

By: Konstantinos Efstathiou and Guntram B. Wolff Topic: European Macroeconomics & Governance Date: July 23, 2019
Load more posts