In Greece we focus on
strengthening competitiveness by facilitating the expansion of the private sector
supporting sustainable energy and infrastructure, including through further regional linkages
- further enhancing the resilience of the financial sector.
As well as being a country where the EBRD invests, Greece is also an EBRD donor, having contributed €525 million in donor funds. Greece established a bilateral technical cooperation fund with the EBRD in 1995, replenished over time, which is actively supporting EBRD investments. Greece has also contributed €500,000 to the Western Balkans Investment Framework (WBIF). In 2020, Greece contributed €20 million in respect to the Greek PPP Preparation Facility Cooperation Account. In 2021, Greece channelled €500m in concessional loans from its EU Rapid Recovery Facility contribution through the EU-EBRD Greece RRF 2.
Current EBRD forecast for Greece Real GDP Growth in 2023: 2.4%
Current EBRD forecast for Greece Real GDP Growth in 2024: 2.3%
In Greece, the strong post-Covid economic recovery continued in 2022 but slowed down in the second half of the year. GDP grew by more than 8 per cent year-on-year in the first six months of 2022, driven by buoyant private consumption, rising government spending and strong export growth. Tourism also performed exceptionally well in 2022, with non-residents’ receipts almost matching the pre-Covid record year of 2019.
However, confidence among consumers and producers became increasingly fragile in the second half of the year, contributing to a sharp drop in growth in the third quarter, as global energy markets faced increasing uncertainty and turbulence and as the Eurozone economy slowed down markedly. Overall, GDP grew by 5.9 per cent in 2022, somewhat higher than expected on strong end of year performance. High-frequency indicators on industrial production and confidence in the first months of 2023 were mostly positive.
Annual inflation is falling rapidly after exceeding 12 per cent at one point in 2022, dropping to 5.4 per cent in March 2023 (HICP measure). The government responded to the energy crisis with mitigating measures, which have a significant fiscal cost, but the budget is on track for a return to primary surpluses in 2023. Public debt remains the highest in Europe (as a per cent of GDP) but the ratio fell sharply in the past two years, from more than 200 per cent of GDP (end-2020) to around 170 per cent at end-2022, as a result of high nominal GDP growth and further debt relief measures. While the economy is slowing down, the overall short-term outlook remains a positive one. A moderate growth slowdown, reflecting global developments, is projected in 2023 (GDP growth of 2.4 per cent), as well as 2024 (2.3 per cent). The implementation of projects, funded by both loans and grants, under the EU’s Recovery and Resilience Facility is advancing well and is mitigating the downside risks coming from global and regional turbulence.