Headlines
Greece sees 2026 economic growth at 2.4%, rapid debt reduction
Published by Global Banking and Finance Review
Posted on November 20, 2025
2 min readLast updated: January 20, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on November 20, 2025
2 min readLast updated: January 20, 2026
Greece anticipates 2.4% growth in 2026, with debt reduction and increased investment, outperforming major EU economies.
ATHENS (Reuters) -Greece expects its economy to grow faster in 2026 and its public debt to decline by almost 8 percentage points, thanks to higher investment and robust consumer spending, according to the final budget plan.
The government expects economic output to rise 2.4% next year, outperforming Europe's major economies, following expansion of 2.2% this year, partly with the help of European Union recovery funds.
Greece projects a primary surplus, which excludes debt servicing costs, of 2.8% of gross domestic product next year, on the back of higher tax revenue and lower unemployment.
Since emerging from a bailout in 2018, Greece has regained its investment grade ratings in 2023, revived its banking system and relied solely on debt markets for its borrowing needs.
Its public debt - now the highest in the euro zone - is seen dropping by 7.7 percentage points to 138.2% of GDP in 2026 from 145.9% this year and to below 120% in 2029.
"Our target is to stop being the most indebted country in Europe in the next years," Finance Minister Kyriakos Pierrakakis said at a press conference presenting next year's budget plan.
The new budget includes tax breaks of about 1.7 billion euros ($1.96 billion) to boost households with children and fund pension hikes amid the rising cost of living, funded by the primary surplus.
Greece should achieve a primary surplus of about 2% annually, compared to 3.7% this year, to be able to cover its interest rate payments and keep its huge debt sustainable.
The country plans to borrow about 9 billion euros next year from bond markets and repay more bailout loans in December ahead of schedule.
($1 = 0.8676 euros)
(Reporting by Lefteris PapadimasEditing by Alexandra Hudson, Kirsten Donovan)
Debt sustainability refers to a country's ability to manage its debt levels without requiring debt relief or accumulating further debt, ensuring that it can meet its current and future financial obligations.
Economic growth is the increase in the production of goods and services in an economy over a period of time, typically measured as the percentage increase in real GDP.
Explore more articles in the Headlines category
