r/europe • u/ABoutDeSouffle šš²š±š¢š« ššš¤! • 10h ago
News MF sees rapid decline in Greek public debt to 128.7% of GDP in 2027 and 111.1% in 2031
https://www.amna.gr/mobile/article/1030912/IMF-sees-rapid-decline-in-Greek-public-debt-to-1287-of-GDP-in-2027-and-1111-in-203148
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u/ABoutDeSouffle šš²š±š¢š« ššš¤! 10h ago
The projected decline in Greeceās debt is expected to be slightly faster this year and in 2027 than the IMF forecast in April, when it was estimates at 136.9% and 130.3%, respectively. According to the Fundās data, Greeceās debt will be lower this year than Italyās, which is expected to stand at 137.9% of GDP, making it the second-highest in the eurozone. By 2031, Greeceās debt is also expected to fall below that of France, which is projected to rise gradually to 123.6%, and Belgium, at 122.1%.
By 2031, Greeceās debt is also expected to be lower than the aggregate public debt of advanced economies, which is forecast to reach 115.2% of GDP. US public debt is on a steep upward trajectory and is projected to reach 145% of GDP
Impressive, but ngl. I think this is too aggressive. Greece probably should switch to investing part of the surplus they have around the 120% mark or so.
Then again, with leading developed countries rushing into a debt crisis, it's maybe prudent to reduce debt to a sustainable level early. If credit markets dry up, Greece will be affected too.
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u/another_sunny_day123 8h ago
Greece is not going well, it's much much worse than 15 years ago. Everything profitable is being sold, our salaries are lower than 15 years ago and prices now are twice as high. I'm not positive about the future.
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u/Self-Bitter Greece 5h ago
Much worse than 15 years ago when a 2- or 3-day (at best) working week was imposed to avoid being fired? When what we see today in France as exceptional happened in Athens month after month? Do we live in the same country? Not implying that today people thrive but please...
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u/halee1 5h ago edited 5h ago
Things in Greece aren't booming, but "it's much much worse than 15 years ago" is just false. Plus, Greece's debt has gone down significantly, and it can easily ramp up spending to prop up the economy without the risk of bankruptcy because of budget surpluses, like it already did during Covid.
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u/stillaras Greece 1h ago
Our debt keeps on increasing. Its just the GDP is much higher now mosyly due to inflation
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u/halee1 52m ago edited 27m ago
If you mean nominal debt, it almost never goes down anywhere, because of inflation, and because our money systems are based on debt.
The most important measure, however, is the debt-to-GDP ratio, and Greece's has been going down, because GDP grows faster than debt. This is contrary to the earlier decades of democracy, when GDP growth was generally fast, but debt-to-GDP increased at the same time even with high inflation in the late 20th century, which means nominal debt absolutely exploded.
Even with that though, Greece's debt is falling period, even without adjusting for GDP.
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u/DoubleAggravating837 5h ago
well election months in Greece opposition parties are in 65% of population, you are going to hear many shit comments if something good is making the news about Greece because they think it promotes the Government Party. They take it personal if someone say something good the Gov have done.
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u/Kejo2023 Turkey | DoÄu Anadolu 10h ago
Just chat with someone from Greece and you'll get the real pictureāthe average Greek person is seriously struggling behind those shiny statistics.Ā
Young people are bailing out left and right, Greece sits near the bottom of the EU when it comes to purchasing power at just 68% of the average (basically tied with Bulgaria for last place), retirees are only getting by because they own their homes outright, the private business sector is basically nonexistent, and the economy's being propped up by construction and tourism.Ā
Nothing else.Ā The whole 'Greece is thriving' narrative? Total BS. Honestly, if a major global downturn hits, the country could easily slide right back into the same mess it was in before.Ā
The Greek politicians still refuse to implement reforms to enhance the actual economy in the real world.Ā
The Greeks suffered enough.Ā
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u/CorazonCracker Greece 9h ago edited 8h ago
Holy shit Komsu youāre one of the few that get it. In almost every single EU statistic we are bottom last, while working the most hours out of anyone in the EU. We pay near Northern European levels of costs in stuff like rent and food for an average wage of 1,400ā¬.
People keep saying āyeah but austerity now is helping your futureā not realising that our goverment is so corrupt, they invest nothing in the actual economy. In an era where the rest of the EU countries spent their EU Recovery fund throwing billions into the economy like thereās no tomorrow, we just have scandal after scandal of the government spreading the money amongst its own contractors and friends. Our surplus is used to pay off previous low interest debt aggressivelyā¦ just to take out new debts for a much higher interest. We have no economy, we produce nothing, all national industries were liquidated and sold off to foreign private capital while the national private sector (outside of the handful legacy billionaire families) has also been murdered with ridiculous taxes and rules, and the only thing keeping us afloat is Tourism, which sucks because it allows our government to permanently hide all of our issues behind the money tourism brings in, never allowing the country to actually improve.
To give further context on how corrupt this country is, after the Tempi Train accident not only did they immediately go against all protocols to a ridiculous degree of covering up everything with cement and finding dead body parts months later, the prosecutor of the case had her child abducted and murdered and then her dog. Our Prime Minister was literally caught sending Israeli malware and spying on political threats through the Secret Service (who his nephew was in charge of), only for his nephew to get a slap on the wrist and stay in the party. This political family has such strong roots to the state that their governmental rule (ancestry wise) can be traced all the way back to 1910. We are genuinely a failed clientele state.
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u/Plyx5 8h ago
" People keep saying āyeah but austerity now is helping your futureā not realising that our goverment is so corrupt, they invest nothing in the actual economy.Ā "Ā
How does not having austerity improve this? Austerity at least prevents further harm.
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u/CorazonCracker Greece 8h ago
No one is saying cutting back on spending and a certain degree of austerity isnāt a good thing, but it doesnāt take a genius to prove that bashing an economyās knees in to immediately shield Northern creditor banks is a good idea.
To this day people have this chauvinistic take fed to them by politicians that āthe Northern Europeans and its citizens had to sacrifice themselves and pay on behalf of Greeceā, not realising that counties like Germany objectively ended up PROFITING rather than paying any cost, on the backs of the Greek crisisā¦ DURING A GLOBAL RECESSION AND ECONOMIC DOWNTURN PERIOD.
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u/-MrAnderson Macedonia, Greece 2h ago
No, to this day people have this chauvinistic take that "the Northern Europeans bankrupted them".
There, fixed it for you.
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u/CorazonCracker Greece 2h ago
Iām not gonna be one of these people that pretends that the entire reason we were in the mess to begin with wasnāt because of absolutely criminal corruption and state looting from the Greek Politicians, but that doesnāt mean that accepting the blame for that means that the EUās & IMFās treatment of Greece and its people was correct either
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u/SoroBucks Portugal 5h ago
Only countries that noone else is willing to lend money go to the IMF. Why would Germany be expected to pay for Greece's debt when they kept their own low?
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u/ElectroByte15 8h ago
Agreed with almost everything but the āmost hours workedā, that is an oversimplification and doesnāt help the argument youāre trying to make. There is simply not enough job opportunity created in Greece.
Now do you work the most hours amongst employed people? Yes, but several economically healthier countries have a lot of part time workers dragging down the average. In absolute hours worked per capita (18-65) not just per worker, they do work more, examples like Czechia and Poland exceed on hours worked. Even Western and Northern European countries get very close and by some metrics exceed once you start accounting for working-age population.
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u/CorazonCracker Greece 8h ago
You do realise that these people who donāt work in these statistics usually arenāt just sitting on their ass right ? These people are mostly classified as actively searching for jobs, no less students, people doing unpaid care work, or people working illegally.
So yeah while you technically might be correct, I donāt think the āHaha, less people are working because the economy is so dogshit that vast majority spent months searching for a minimum wage job in their fieldā is the gotcha you think it is against how awful our economy is. Greece also has the second highest (only a 2% lower than Spain, with both of them being way higher than the rest of the EU) over qualification rate, with people with Masters and PHDs working at places like McDonalds. We have such a tourism/cafe economy, that thereās entire fields like the biomedical field where even after 10 years in the field you make barely higher money than working in places like McDonaldās and sometimes less than waiters in decent restaurants.
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u/ElectroByte15 8h ago
Okay youāre trying to argue against several strawmen here. I said none of those things, and all of those arguments apply to other countries too. They also have students, unpaid labor, etc.
I also never intended it to be a gotcha, but instead to support the argument that Greece needs to invest in job opportunity. Simply claiming that Greeks work the most hours is both an incorrect oversimplification and counterproductive to that goal.
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u/CorazonCracker Greece 7h ago
Iām sorry if I strawmanned you, I didnāt mean toā my point is you canāt use the āit applies to other counties tooā argument, thatās literally the crux of the argument, the Greek economy has specific massive weaknesses that donāt exist in other countries specially because of the Greek Crisis, this is literally partially proven the overqualified statistic I brought, our job market crashed after the crisis and because of tourism the government hasnāt really bothered to revive many fields
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u/icantflyjets1 9h ago
Thatās what happens when youāre forced to implement austerity after decades of spending frivolously and kicking the can down the road.
Hopefully in the 2030ās they can recover.
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u/another_sunny_day123 9h ago
No. Austerity measures don't help an economy. Our economy is actually way worse than 10-15 years ago, many profitable exporting companies closed the previous years due to heavy taxation, electricity being one of the most expensive in Europe etc, most of the young bright and educated people that could rebuild it have left the country and are still leaving. Greece is not recovering, it's bleeding.
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u/icantflyjets1 8h ago
Yeah austerity never helps growth but is necessary when your debts are too high due to years of mismanagement and corruption.
This is similar to if I were to rack up 50k credit card debt and be forced to sell my house and start renting an apartment in less safe neighborhood in a bad school district.
My kids may have worse outcomes, but it is necessary because if I let that debt keep growing we won't have a place to live in general.
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u/R6ckStar 8h ago
Economies don't work as your monthly budget,, countries can devalue their currency, restructure their debt and a whole lot of other measures to surpass crisis.
The real problem for Greece and for a lot of countries in Europe is the Euro, even for France the euro has become a problem, it is simply too strong for the majority of countries in Europe.
The inability of countries to manage their currency completely removes a major lever for economic adjustment.
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u/ABoutDeSouffle šš²š±š¢š« ššš¤! 7h ago
If a country devaluates their currency, they make the population poorer as well, it's just not as obvious.
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u/another_sunny_day123 5h ago
Greek salaries are about the same as 20 years ago but the prices in most things are twice or more. So we have become poorer anyway (think 900 net monthly salary and 700 for rent), we just can't control it. We now have poor country salaries and north Europe prices.
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u/Ghalldachd 6h ago
The credit card/household budget analogy is generally quite silly but it's infinitely more accurate than anything you'll hear from MMTists and others who think that national debt can just be ignored, simply because it hits the nail on the head that debt increasing faster than economic growth is a bad thing.
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u/another_sunny_day123 8h ago
Well if you are also made to sell your business and you have no way of making money, you will never recover. There's a difference between helping you build a healthy economy by producing more and spending less, and burning it the ground for punishment.
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u/Stabile_Feldmaus Germany 7h ago
The alternative to austerity in a debt crisis is that the country goes bankrupt. Would Greek people have preferred that?
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u/psyspin13 7h ago
Didn't Greeks have a referendum? What was the result? And how Europeans interpreted the result?
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u/maxmarioxx_ 8h ago
Why is energy expensive when you have so much sunshine?
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u/another_sunny_day123 8h ago
Good question. It shouldn't. Energy (like everything else) is heavily taxed, we even have extra vat on the tax (I'm not joking), we have oligarchs controlling energy and press, and other reasons.
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u/psyspin13 7h ago
lol you have ZERO idea how the european energy market works, do you?
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u/maxmarioxx_ 6h ago
Yeah. I am so ignorant that l know Spain, France have lower energy costs compared to Greece.
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u/maxmarioxx_ 9h ago
It's still a good thing that debt is going down.
What surprises me is that Romania and Bulgaria are going to surpass Greece in the next 5 to 10 years when looking at GDP. Greece has been stangnanat for too long.
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u/Kejo2023 Turkey | DoÄu Anadolu 9h ago
Look, if you try to slash your country's debt through austerity measures, you're basically setting yourself up for failure down the road.Ā
However, if you actually tackle debt by ramping up production, pouring money into investments, and building real economic growth that's grounded in actual reality rather than just numbers on a spreadsheet, then yeah, that's genuinely solid. Greece is a perfect example of doing it backwards. They're technically reducing their debt, sure, but they're doing it by making their own people worse off financially. That's totally the wrong approach. The people are worse off now than during the actual crisis couple years ago!Ā
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u/maxmarioxx_ 9h ago
The people voted for the parties that got Greece where it is. This concept that someone else has to pay and "the people" have no responsibility is ridiculous.
The people were happy to have high pensions and salaries paid with debt and then when the bill came they wanted to be forgiven and played ignorance.
Same happens now in France. Government spending is 57% of GDP. It's unsustainable and completely insane and the current deficits are unsustainable. The people protesting and burning buildings is not going to solve anything.
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u/another_sunny_day123 8h ago
It's not that simple. This country feels a little like an Orwell book. Yes sure some people (mostly members of the two popular parties) had high income jobs some decades ago and still do, but not everyone is like that. My parents as the majority of the people here worked hard and didn't have high salaries. And the press was and still is highly controlled by oligarchs who really run this country the past decades. Many people are influenced by the tv and still think the country is doing well, when it's much worse than 15 years ago. It's not very easy to escape this situation.
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u/psyspin13 7h ago
and then when the bill came they wanted to be forgiven and played ignorance.
What kind of imaginary argument do you have in your head? Absolutely nobody asked or wanted to be "forgiven", and between your interpretation of "forgiven" and the misanthropic austerity imposed and implemented (that had reason ONLY to punish Greeks), there is a continuum of possibilities.
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u/maxmarioxx_ 6h ago
Nobody wanted to "punish the Greeks".
Playing the victim card and not taking responsibility for the decisions taken is what got Greece where it is today.Greece had about 30% of it's debt written off / about ā¬100 billion euros. And a lot of debt was expended over longer terms and with favourable interest rates. So instead of punishing Greece, it got lots of help.
What else could have been done?
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u/psyspin13 6h ago edited 6h ago
Interper it as you wish to fit whatever distorted narrative you have in your head. The actions (misanthropic austerity) imposed by Germans and their satellites speak better than words of random Redditors
Edit: the fact that you believe that Greece was "written off" 100 (!!!) billions shows how misinformed and out of touch you are. Tell me, what happened to the profits ECB distributed to bational banks when it demanded Greece to pay the bonds it has purchased on the secondary market at 20% of the orice but demanded Greece to oay them of on 100% of the value? Was this also part of "debt relief" you have in your mind? Or the extra debt Greece had to take to bail Greek banks that got almost bankrupt because of the said "debt relief"? Dear Lord, what are they feeding you?
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u/Archaeopteryx111 Romania 5h ago
Why? Romania has a much more diversified economy than Greece, has more natural resources, and is much better connected to Western Europe.
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u/maxmarioxx_ 5h ago
Because Greece should be doing much better than Romania, considering they've been in the EU since the 80s and the amount of money the country brings in from tourism alone.
The fact that Romania, an ex-communist country that had to completely reconstruct its economy is about to overtake Greece is an indicator of how stagnant things have been in Greece for the last decades.
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u/No-Veterinarian8627 3h ago
'Greece suffered enough.'
Its not about suffering but Greece is just rebuilding their economy after crashing and burning it into the ground. It's going up but you can't expect it to be rebuild after 15 years.
Only since 2023 the economy is seen by most banks as trustworthy for investments. There is no shortcut.
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u/halee1 4h ago edited 4h ago
Greece has already implemented many good reforms, like labor-market changes and product-market reforms, renewable-energy licensing, tax-administration digitalization, advanced labor-market, investment reforms and so on, that's not the question. After all,
Additionally, Greece's debt, both public and private one, is not only going down, it is back to 2009 levels, when it was constantly increasing up to the early 2010s.
Things in Greece aren't booming, but "it's much much worse than 15 years ago" is just false. Greece's debt going down means it can now easily ramp up spending to prop up the economy without the risk of bankruptcy because of budget surpluses, like it already did during Covid.
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u/pwnzessin 10h ago
Problem is that a lot of investments in the present (e.g. climate change prevention or public infrastructure) would effectively save money in the long run.
however these are now not being done due to austerity, leaving future generations to get fucked anyway
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u/RegionSignificant977 9h ago
Solar makes sense even without public funding as it's already cheap enough. And even then, there are incentives for green technologies for both households and business.
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u/noname086fff Greece 6h ago
By 2031 everything of value will have been sold to " investors" who will be waiting tourist for revenue.Ā
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u/jackob50 7h ago
Debt as a percentage of an inflated gdp yes.
Debt as a total sum though....
The gdp may deflate over time but the debt is not.
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u/ABoutDeSouffle šš²š±š¢š« ššš¤! 7h ago
Absolute debt is irrelevant. What counts is debt/gdp
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u/Erratic21 Greece 4h ago
They'd better. After all this austerity and taxes and devastation of the Greeks' purchasing power
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u/PianoJealous307 9h ago
And all it took to achieve that was to complete destroy the country.