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Economic and political overview

Economic Overview

Due to Greece's heavy reliance on tourism and the hospitality industry, the country was among the most severely hit by the Covid-19-induced crisis. However, the Greek economy rebounded strongly and GDP reached its pre-pandemic level already in the second half of 2021. Economic activity grew by 2.3% year-on-year in 2024, mainly driven by domestic demand, though net exports held back growth. Minimum wage hikes boosted private consumption, especially for lower-income households with higher consumption rates. Equipment investment accelerated alongside strong corporate credit growth, while a rise in imports and slow export growth led to a decline in net exports. The IMF expects real GDP growth to stay strong at 2.1% in 2025 before moderating in the medium term. Investment will remain a key driver, supported by NGEU-funded projects, while private consumption growth should stay robust, driven by positive employment and income growth.

Concerning public finances, the headline deficit decreased from 1.3% of GDP in 2023 to 0.6% of GDP in 2024, reflecting an increase in the primary surplus from 2.1% of GDP in 2023 to 2.9% in 2024. This decline was largely due to slow growth in current expenditure and higher income tax revenues. In 2025, the headline deficit is expected to further reduce to 0.1% of GDP, mainly driven by lower interest expenditure due to declining short-term interest rates. The primary surplus is projected to remain high at around 2.5% of GDP in 2025, as reduced revenue from an additional cut in social security contributions is largely offset by revenue gains from reforms targeting tax evasion and improving compliance. By the end of 2024, the public debt-to-GDP ratio is expected to have fallen by over 50 percentage points from its 2020 peak (to around 159%), driven by strong growth, high inflation, and significant fiscal consolidation. The banking system has strengthened its resilience with improved asset quality and capital adequacy. Asset quality in systemically important banks continued to improve, with the NPL ratio falling to around 3% in Q3 2024, aided by a government-backed securitisation framework. Banks maintained high profits, which, along with capital instrument issuances, enhanced capital adequacy, though there is still potential for further strengthening of voluntary capital buffers (IMF). Disinflation is progressing gradually, with headline and core inflation at 2.9% and 3.4% (y/y) at the end of 2024, respectively, amid ongoing services inflation and wage growth. With global energy prices stabilising, headline inflation is expected to continue its downward trend, while core inflation is likely to remain more persistent due to services inflation and wage growth (IMF).

The unemployment rate dropped to 9.5% (seasonally adjusted) in Q3 2024, the lowest since 2009, while the vacancy rate increased, indicating labor shortages in sectors such as construction, tourism-related services, and high-skill industries. The labour force participation rate has gradually risen but remains one of the lowest in the EU, particularly for women. According to the latest data by Eurostat, Greece’s GDP per capita is one-third lower than the EU average (estimated at USD 43,800 in 2024 by the IMF – PPP).

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 238.28252.73265.17275.85285.00
GDP (Constant Prices, Annual % Change) 2.02.32.01.71.5
GDP per Capita (USD) 22,88024,34225,61626,68827,614
General Government Balance (in % of GDP) -0.9-1.3-1.3-1.3-1.4
General Government Gross Debt (in % of GDP) 168.9159.0152.9149.1145.4
Inflation Rate (%) 4.22.92.12.02.0
Unemployment Rate (% of the Labour Force) 11.110.510.19.59.0
Current Account (billions USD) -16.37-16.48-13.98-13.01-11.68
Current Account (in % of GDP) -6.9-6.5-5.3-4.7-4.1

Source: IMF – World Economic Outlook Database , October 2021

Country Risk

See the country risk analysis provided by La Coface.

 

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Main Sectors of Industry

Traditionally, Greece's economy has been based on agriculture, and although nowadays the sector represents only 3.3% of GDP and employs 11% of the labour force, these shares are among the highest in the EU (World Bank, latest data available). The country has an agricultural area of around 5,867k hectares and a forest area of 3,901k hectares (FAO). The main crops are tobacco (the third-largest European producer) and cotton. Olives - many of which are used to produce olive oil - are the country's most renowned export crop. Greece has an important sheepherding industry and the fishing sector is well developed in the coastal regions (65% of domestic production of fishery products comes from aquaculture, while the remaining 35% from fishing). Greek agricultural output has declined by 0.3% annually over the past 30 years. According to data from Eurostat, the volume of agricultural output in Greece in 2023 was down by 16% compared to the previous year, while production was valued at nearly EUR 12.9 billion, down 3% from 2022. Including agricultural services and secondary activities, total production topped EUR 14 billion, 1.4% lower than in 2022. The sector contributed EUR 7 billion to GDP in 2023.

As a result of the country's diversification of the economy, industry has replaced agriculture as the second source of income after services, accounting for 15.3% of GDP and employing 16% of the labour force. However, its share was higher before the economic crisis of 2007 (above 20%). Manufacturing is estimated to account for 9% of GDP (World Bank). The main sectors are electronics, transport equipment, clothing manufacturing and construction. Moreover, Greece has the largest maritime fleet in the world. According to data from the Hellenic Statistical Authority, industrial output increased by 6.7% year-on-year in the first eight months of 2024.

The service sector accounts for 68.6% of GDP and employs 73% of the labour force. Tourism provides an essential source of income and on its own contributes to almost one-fifth of GDP (the primary sector of contribution to the national economy). The sector directly employs just below 400,000 people, accounting for 10% of total employment in the country. Greek tourism, including domestic travel and investments, contributed 13% to GDP (EUR 28.5 billion) in 2023, according to the Greek Tourism Confederation. Inbound tourism grew 4% from 2019, reaching 32.7 million travellers, while cruise passenger arrivals rose 26% to 3.3 million. Total international arrivals hit 36 million, a 6% increase from 2019. Tourism receipts (excluding cruises) reached a record EUR 19.8 billion, up 12% from 2019. Cruise revenues surged 70% to EUR 847 million. Concerning the banking sector, in 2023, Greek banks reported post-tax profits of EUR 3.8 billion, up from EUR 3.4 billion in 2022. Their Return on Assets (RoA) and Return on Equity (RoE) reached 1.2% and 12.0%, exceeding the euro area average (data European Banking Federation).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 11.5 16.0 72.6
Value Added (in % of GDP) 3.3 15.3 68.6
Value Added (Annual % Change) -26.8 4.7 3.2

Source: World Bank - Latest available data.

 
Monetary Indicators 20162017201820192020
Euro (EUR) - Average Annual Exchange Rate For 1 USD 0.940.890.850.890.88

Source: World Bank - Latest available data.

 

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Foreign Trade

Greece has an export-oriented economy, with trade representing 92% of GDP (World Bank, latest data available). According to data from Comtrade, petroleum oils had the largest share of exports for 2023 (26.5%), followed by medicaments (5.9%), petroleum gas (2.9%), and olive oil (2.3%). As per imports, petroleum oils were the main item (20.6%), ahead of petroleum gas (5.4%), motor cars (3.6%), and medicaments (3.3%).

In 2023, Greek exports were mostly directed towards Italy (11.5%), Bulgaria (6.8%), Germany (6.6%), Cyprus (6.1%), United States (4.2%), and Spain (4%); whereas imports came chiefly from Germany (10.1%), China (8.4%), Italy (7.5%), Iraq (6.4%), the Netherlands (5.9%), France (4.3%), and Kazakhstan (4.1% - data Comtrade).

Data by WTO shows that, in 2023, exports of goods stood at USD 55 billion, marking a 4.3% decrease year-on-year; whereas imports totalled EUR 88.6 billion (-9.5% y-o-y). As per services, exports totalled USD 53.2 billion against USD 29.8 billion of imports (+7% and +0.1% year-on-year, respectively). The World Bank estimated the country’s trade deficit to be 4.7% of GDP in 2023, down from 9.6% the previous year. According to preliminary figures from the Hellenic Statistical Authority, Greek exports from January to December 2024 totalled EUR 49.9 billion, down 2.2% from EUR 51.0 billion in 2023. Excluding oil products, exports rose by EUR 819.8 million (2.3%), and by EUR 839.0 million (2.4%) when excluding both oil products and ships.

 
Foreign Trade Values 20192020202120222023
Imports of Goods (million USD) 62,38455,94777,10598,00588,617
Exports of Goods (million USD) 37,90735,21547,21857,52955,047
Imports of Services (million USD) 21,32217,58726,21229,78529,815
Exports of Services (million USD) 44,96125,98541,32149,74553,259

Source: World Trade Organisation (WTO) ; Latest available data

Foreign Trade Indicators 20192020202120222023
Foreign Trade (in % of GDP) 80.670.388.0107.792.2
Trade Balance (million USD) -25,572-21,135-31,224-41,590-35,713
Trade Balance (Including Service) (million USD) -2,008-12,737-16,011-21,631-12,017
Imports of Goods and Services (Annual % Change) 2.8-7.317.411.00.9
Exports of Goods and Services (Annual % Change) 4.8-21.524.46.61.9
Imports of Goods and Services (in % of GDP) 41.038.847.858.748.4
Exports of Goods and Services (in % of GDP) 39.631.540.349.043.7

Source: World Bank ; Latest available data

Foreign Trade Forecasts 20242025 (e)2026 (e)2027 (e)2028 (e)
Volume of exports of goods and services (Annual % change) 1.72.82.82.52.6
Volume of imports of goods and services (Annual % change) 2.74.32.32.22.1

Source: IMF, World Economic Outlook ; Latest available data

Note: (e) Estimated Data

 
International Economic Cooperation
Greece is a member of the following international economic organisations: IMF, European Union, WTO, European Economic Area, ICC, Black Sea Economic Cooperation Zone (BSEC), OECD, among others. For the full list of economic and other international organisations in which participates Greece click here. International organisation membership of Greece is also outlined here.
Free Trade Agreements
The complete and up-to-date list of Free Trade Agreements signed by Greece can be consulted here.
 

Main Partner Countries

Main Customers
(% of Exports)		 2023
Italy 11.5%
Bulgaria 6.8%
Germany 6.6%
Cyprus 6.1%
United States 4.2%
See More Countries 64.9%
Main Suppliers
(% of Imports)		 2023
Germany 10.1%
China 8.4%
Italy 7.5%
Netherlands 5.9%
France 4.3%
See More Countries 63.8%

Source: Comtrade, Latest Available Data

 

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Political Outline

Current Political Leaders
President: Katerina Sakellaropoulou (since 13 March 2020)
Prime Minister: Kyriakos Mitsotakis (since 26 June 2023)
Next Election Dates
Presidential: February 2025
Parliamentary: 2027
Current Political Context
The incumbent centre-right and liberal party New Democracy (ND) triumphed in the June 2023 elections, clinching 40.6% of the vote and securing 158 out of 300 parliamentary seats, including the 50 bonus seats awarded to the majority. Prime Minister Kyriakos Mitsotakis has thus obtained a second mandate to continue implementing an EU-backed reform and modernization agenda. In the European Parliament elections held on June 9, 2024, the ruling New Democracy party emerged as the leading force but saw a decline in both its share of the popular vote and the number of seats won. The left-wing SYRIZA and PASOK parties secured second and third place, respectively, with SYRIZA losing two seats and PASOK gaining one. Collectively, left-wing parties that earned representation secured 10 seats and 40.36% of the vote, while right-wing parties obtained 11 seats with 45.02% of the vote. In January 2025, PM Mitsotakis nominated Parliament Speaker Constantine Tassoulas, a member of the New Democracy party, for the presidency of Greece (a largely ceremonial role). The current president, Katerina Sakellaropoulou, will conclude her five-year term in March. On 31 January 2025, the Greek parliament failed to elect a new president in the second of four voting rounds, as Tasoulas received 160 votes out of the 200 needed (same as in the first round). A third vote is scheduled for February 6, requiring a three-fifths majority (180 votes) for a successful outcome. If this threshold is not met, a fourth vote will take place five days later, where the president can be elected by an absolute majority of 151 votes from all MPs.
On the international front, Greece maintained its support for Ukraine amidst the ongoing conflict with Russia, aligning with European Union policies.
Main Political Parties
The main political parties/alliances currently represented in the Greek parliament include:

- New Democracy (ND): centre-right. ND's policies are based on free-market economics and social conservatism. It obtained 158 seats thanks to the majority bonus system
- Coalition of the Radical Left (SYRIZA): left-wing anti-establishment, populist, anti-austerity (47 seats)
- Movement For Change (PASOK-KINAL): centre-left; it is a breakaway faction from SYRIZA that was formed in 2021
- Communist Party of Greece (KKE): Marxist-Leninist, the oldest party in Greece
- Spartans: far-right political party, it has strong connections with the extreme-right Golden Dawn
- Greek Solution: right-wing, ultranationalist. It was formed in 2016 by former Golden Dawn MP Ilias Kasidiaris
- Democratic Patriotic Movement (Victory): conservatism, Christian nationalism
- Course of Freedom: anti‑establishment, left-wing populist.

Executive Power
According to the Constitution, executive power is exercised by the President of the Republic and the Government. The role of the President in the executive branch has been reduced to ceremonial since 1986. The post of Prime Minister, Greece's head of government, belongs to the current leader of the political party that can obtain the confidence of a parliamentary majority. The President of the Republic formally appoints the Prime Minister and, on his or her recommendation, appoints and dismisses the other members of the Cabinet. The Prime Minister exercises vast political power and the amendment of 1986 further strengthened their position to the detriment of the President of the Republic.
Legislative Power
Legislative power is exercised by a 300-member unicameral Parliament. Statutes passed by the Parliament are promulgated by the President of the Republic. Parliamentary elections are held every four years, but the President of the Republic is required to dissolve the Parliament earlier on the proposal of the Cabinet, when faced with a national issue of exceptional importance. The President is also required to dissolve the Parliament earlier than scheduled if the opposition succeeds to pass a motion of no confidence.
 

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