Finance
Greece to Be Overtaken by Italy as Euro Zone's Most Indebted Country in 2026, Sources Say
Published by Global Banking & Finance Review®
Posted on April 23, 2026
2 min readLast updated: April 23, 2026
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Greece’s public debt is projected to fall below Italy’s in 2026, ending its long-standing position as the euro zone’s most indebted. Greece aims to reduce its debt-to-GDP ratio by around 8 percentage points, while Italy’s is set to rise modestly, according to budget forecasts and estimations.
Italy Set to Overtake Greece as Euro Zone's Most Indebted Country by 2026
Shifting Debt Dynamics in the Euro Zone
By Lefteris Papadimas and Giuseppe Fonte
Greece's Debt Reduction and Italy's Rising Ratio
ATHENS/ ROME, April 23 (Reuters) - Greece will no longer be the euro zone's most indebted country by the end of this year, with its public debt set to fall below Italy's, according to sources and data from Italy's new budget plan.
Greek debt is estimated to be reduced to about 137% of gross domestic product this year from 145% in 2025, two senior officials told Reuters.
By contrast, Italy sees its debt rising from 137.1% of GDP in 2025 to 138.6% in 2026, under the Treasury's multi-year budget plan (DFP) published on Thursday.
Official Statements and Fiscal Planning
"Greece will not be the most indebted country in the euro zone - from this year", one of the two Greek officials told Reuters.
The new estimate for Greece's debt ratio will be included in the country's new multi-year fiscal plan that will be submitted to the European Commission at the end of this month.
Long-Term Debt Projections for Italy
Italy's debt will remain virtually stable at 138.5% in 2027, before declining to 137.9% in 2028 and to 136.3% the following year, its budget plan showed.
Historical Context and Future Outlook
Since 2020, Greece's public debt - the highest in the euro zone over the last two decades - has shrunk by more than 45 percentage points to 145% of gross domestic product last year. Italy cut its debt by some 17 percentage points over the same period.
Greece's Recovery and Bailout Repayments
Greece, which is recovering from a decade-long financial crisis and three bailouts totalling about 280 billion euros, plans to repay ahead of schedule loans worth some 7 billion euros from its first bailout later in the year.
(Reporting by Lefteris Papadimas in Athens and Giuseppe Fonte in Rome, Additional reporting by Gavin Jones in Rome, Editing by Timothy Heritage)
Key Takeaways
- •Greece expects its debt-to-GDP ratio to drop to roughly 138% in 2026, down from about 146% in 2025 (marketscreener.com).
- •Italy’s debt-to-GDP ratio is forecast to climb to approximately 138.6% in 2026 from 137.1% in 2025, per Italy’s multi‑year Treasury plan (investing.com).
- •The European Commission and IMF also forecast further debt declines for Greece, supporting its objective to shed the title of most indebted euro‑zone country (legalclarity.org).
References
Frequently Asked Questions about Greece to be overtaken by Italy as euro zone's most indebted country in 2026, sources say
1When will Italy overtake Greece as the euro zone's most indebted country?
According to budget plans and official sources, Italy will overtake Greece by the end of 2026.
2What is Greece's estimated public debt as a percentage of GDP in 2026?
Greece's public debt is estimated to fall to about 137% of GDP in 2026.
3How is Italy's public debt expected to change between 2025 and 2028?
Italy's debt is set to rise from 137.1% in 2025 to 138.6% in 2026, remain stable in 2027, and then gradually decline through 2029.
4What steps is Greece taking to manage its debt?
Greece plans to repay €7 billion in bailout loans ahead of schedule and implement a new multi-year fiscal plan.
5By how much has Greece reduced its public debt since 2020?
Since 2020, Greece has reduced its public debt by more than 45 percentage points.
