Greece’s economy is expected to remain resilient over the next two years, with GDP projected to grow by 2.0% in 2025 and 2.1% in 2026, supported by strong investment flows from the EU Recovery and Resilience Fund and higher household incomes, the OECD said on Monday.
In its latest Economic Outlook, the Organisation for Economic Co-operation and Development said grants and loans from the Recovery Fund are set to rise from 1.8% of GDP in 2024 to 3.6% in 2026. Private consumption is forecast to increase by 1.2% this year and by 1.7% in 2026, driven by a rise in the minimum wage and disposable income.
However, the OECD expects export growth to slow amid weakening demand from key European Union markets, partly due to U.S. tariffs dampening global trade.
For the broader eurozone, the OECD forecasts GDP growth of 1.0% in 2025 and 1.2% in 2026, compared with 0.8% in 2024. The global economy is also seen cooling, with growth easing to 2.9% in both 2025 and 2026, down from 3.3% this year.
The OECD noted that while business sentiment in Greece’s manufacturing and services sectors dipped in April, expectations continue to point to expansion. Still, it warned that delays in absorbing Recovery Fund resources, excessive wage increases, or renewed extreme weather events could cloud the outlook.
On wages, the report cautioned that if pay continues to rise faster than productivity, export competitiveness could be further undermined.
Inflation, based on the EU’s Harmonised Index of Consumer Prices, is projected to decline to 2.5% in 2025 and 2.0% in 2026, helped by falling oil prices. But price pressures in services and higher trade costs are expected to persist.
Primary budget surpluses are forecast to reach 2.1% of GDP in 2025 and 2.2% in 2026, reflecting stronger tax compliance, the OECD said.
“Maintaining public debt on a steady downward path should remain a priority,” the report said, noting that demographic trends and rising investment needs are likely to increase long-term spending pressures.