WASHINGTON (ANA-MPA)
While the International Monetary Fund (IMF) projects a rise in global public debt, Greece is taking a consistently opposite path. According to National Economy and Finance Minister Kyriakos Pierrakakis, the country is on track to reduce its public debt from approximately 210% of GDP to 137.6% by 2026 — one of the most significant declines worldwide.
“Greece is now regarded internationally as a success story,” Pierrakakis told ERT correspondent Lena Argyri during an interview on the sidelines of the IMF Annual Meeting in Washington. He expressed confidence that Greece will soon no longer be the most heavily indebted country in the European Union.
Pierrakakis cited the performance of Greek 10-year bonds, noting that their yields are lower than those of France and Italy, a fact he said reflects investor confidence. According to IMF estimates, the Greek economy is maintaining positive growth rates and fiscal balance amid a climate of global economic uncertainty.
Growth and Forecasts
Referring to the IMF’s more cautious projections for Greece compared with the draft budget, the minister remarked that the Fund traditionally underestimates Greece’s performance, and that its latest projection has already been revised upward to 2% from 1.8%. He expressed optimism that the 2.4% growth target included in the budget can be achieved.
Pierrakakis noted that Greece continues to post primary surpluses and steadily reduce its debt, which is expected to reach 137.6% of GDP by 2026 based on current data.
Resilience and Reforms
The minister attributed the improvement in Greece’s economic outlook to the resilience of society following the loss of roughly a quarter of GDP during the financial crisis, as well as to the reforms implemented thereafter. He observed that changes currently being discussed in other European countries have already been enacted in Greece, creating a new operational framework for the economy over the past six years.
Challenges and the Demographic Issue
Pierrakakis acknowledged that significant challenges remain, with the demographic problem at the forefront. He pointed out that the measures announced at the Thessaloniki International Fair (TIF) aim to support families with children and young people entering the labor market through lower direct taxation. He clarified that while these measures alone will not solve the problem, they mark it as a policy priority. The goal, he added, is to spread growth across all households through a combination of investment, productivity gains, and continued tax relief.
Debt Path and Credibility
Commenting on the IMF’s report projecting global debt to rise to its highest levels since 1948 within the next three years, the minister emphasised that Greece is moving in the opposite direction, steadily reducing its debt. He recalled that public debt had approached 210% of GDP after the pandemic and is now declining toward the 137.6% target. He credited this development to the systematic work of the Public Debt Management Agency (PDMA) and noted that the early repayment of first-bailout loans strengthened Greece’s market credibility.
Investment Climate
Regarding the investment environment, Pierrakakis highlighted the government’s focus on promoting cross-border mergers and acquisitions, in line with the recommendations in the Draghi and Letta reports for a deeper single market. He cited examples such as the proposed acquisition of the Athens Stock Exchange by Euronext, UniCredit’s increased stake in Alpha Bank, and the acquisition of HSBC Malta by Credia Bank. He added that government strategy prioritises attracting foreign capital into infrastructure, energy, and sectors with a strong Greek business presence.
Economic Transformation
The minister referred to the gradual transformation of Greece’s production model, noting that in 2019, investments accounted for 11% of GDP, compared with a European average of 21.2%. Currently, they stand around 15.3%, with projections reaching 18% by 2026.
“As Minister of Digital Governance, I used to say—and I want to repeat it—that Greece always had the hardware but lacked the software. We had the right raw material, the seeds of opportunity, but not the right strategy, institutions, or policies to attract the investments we wanted,” he said.
European Perspective
In closing, Pierrakakis argued that the European Union must move faster toward a fully functioning single market, free of barriers in services and manufacturing. The goal, he stressed, should be to strengthen companies at a European scale, rather than nurturing fragmented national markets, in order to enhance competitiveness and mobilise larger investment flows.
