Key Policy Insights

The Greek economy has weathered recent crises well. Greece’s GDP-per-capita growth has outpaced the euro area since early 2021 (Figure 1.1, Panel A). As headwinds are subsiding, the economy is emerging with significant gains in competitiveness, growing investment and more high-tech exports, and historically low levels of unemployment (Panel B). Temporary fiscal support helped cushion external shocks, while not standing in the way of substantial improvements in the fiscal balance. Helped by high inflation as well as fiscal consolidation, public debt levels dropped significantly, and Greece regained investment grade rating of its sovereign debt in 2023.