The Greek economy is expected to sustain growth, with projections showing growth rates exceeding 2% for both this year and in 2026. Nevertheless, the combination of new Trump tariffs and a decline in external demand—particularly from EU trading partners like Germany—may hinder export growth, as noted by the Organization for Economic Cooperation and Development (OECD).
The Recovery Fund will play a crucial role in enhancing investment, with increases in the minimum wage likely bolstering consumption, especially as export growth slows alongside external demand. The OECD also cautioned that any delays in utilizing European funds, excessive wage hikes, or extreme weather conditions could adversely impact the Greek economy’s outlook.
In its latest forecasts, the OECD predicts inflation will decrease from 2.5% this year to 2.0% by 2026, driven by declining oil prices, although rising trade costs and ongoing inflation in services persist.
The OECD estimates that Greece will maintain significant primary surpluses of 2.1% of GDP in 2025 and 2.2% in 2026, largely attributed to improvements in combating tax evasion. Enhanced tax revenues, stemming from new collection measures, are expected to support these sustainable surpluses and allow for additional spending.
GDP growth is anticipated to remain strong at 2.0% in 2025 and 2.1% in 2026, with rising disposable incomes boosting consumption. Investment growth, fueled by increased disbursements from the Recovery and Resilience Funds, will remain robust despite global uncertainties.
A primary surplus of 2.1% of GDP in 2025 and 2.2% in 2026 is projected to further lower the debt-to-GDP ratio to 140% by 2026. Although public debt is declining, it remains elevated, prompting the government to prioritize its further reduction. The debt-to-GDP ratio is forecasted to drop to 145.2% this year and 139.8% in 2026.
The Greek economy also grapples with demographic challenges, with rising investment needs increasing pressure on spending. The OECD asserts that continuing reform momentum to enhance the business environment and alleviate significant labor shortages will bolster investment growth.
Ongoing efforts to diminish tax evasion and manage tax expenditures would enhance revenue, creating room for lower taxes and increased employment.
