Not many expected what Greece’s economy has just accomplished.
In 2024, it posted a budget surplus of 1.3% of GDP, outpacing nearly every EU peer and beating its own deficit target by two full points.
The primary surplus, excluding interest payments, was even more striking at 4.8%.
These numbers come from Eurostat’s final fiscal report and are now driving new government support programs worth over €1 billion. But numbers alone don’t tell the full story of what’s changed and what still hasn’t.
How did Greece go from bailout to surplus?
Fifteen years ago, Greece was a financial warning sign. It was a history lesson in how excessive borrowing and malinvestment can crush an economy overnight.
In April 2010, Prime Minister George Papandreou stood on the island of Kastellorizo and asked the EU and IMF to activate a bailout mechanism.
It was the beginning of a painful period of austerity, economic collapse, and three separate bailout programs totaling €289 billion.
By the time the last bailout ended in 2018, Greece had lost a quarter of its GDP. Unemployment was over 27%. The country had become a symbol of crisis.
Fast forward to 2024, and Greece is now one of only six EU countries to post a budget surplus. Greece’s general government surplus came in at 1.3% of GDP. The primary surplus reached 4.8%.
Greece’s debt-to-GDP ratio dropped to 153.6%, beating government targets and declining in both percentage and nominal terms.
For context, Greece’s debt-to-GDP ratio exceeded 200% just 3 years ago.
And this is not a one-off. Prime Minister Kyriakos Mitsotakis called it structural progress, tied to reforms that have changed how the state collects and manages money.
Which reforms actually worked?
The backbone of the recovery is tax enforcement. Greece’s long-standing issue with tax evasion has been tackled more aggressively in recent years.
A new tax authority and digital systems have forced previously untaxed transactions into the open. Payments for childcare services made electronically rose by 433% in 2024.
Additionally, electronic payments in the taxi sector jumped by 200%. The result has been a rise in VAT and corporate income tax revenue.
Corporate taxes have also been lowered. Bureaucracy has been simplified. Investment incentives are more clear.
All of these changes have helped restore investor confidence and help pour money back into the country.
Since 2024, all major credit rating agencies have upgraded Greece’s government bonds to investment grade.
S&P Global issued three separate upgrades in just one month, citing consistent tax overperformance and likely debt reduction.
Greece now secures better borrowing terms than Italy.
Source: Bloomberg
Who benefits from the surplus?
The government is not sitting on the extra funds. In April 2025, it announced new support measures worth more than €1 billion.
One of the most visible is an annual rent refund that will return the cost of one month’s rent to nearly 948,000 households, that’s about 80 percent of renters.
There is also a €250 benefit paid yearly to 1.5 million low-income pensioners and uninsured people. Both of these are permanent.
Public investment is also getting a boost. The Public Investment Program will receive €500 million more each year.
The goal is to support infrastructure, employment, and resilience to external shocks.
Finance Minister Kyriakos Pierrakakis said more measures will be introduced in September 2025. All initiatives are designed to stay within EU fiscal rules, according to the government
What is still holding Greece back?
Although this recovery has been impressive, there are some big stubborn issues.
Greece’s economy is still consumption-heavy.
Private consumption accounts for 69% of GDP, the highest share in the eurozone.
Investment lags behind, and productivity remains low. Many experts argue that the recent growth is driven by short-term momentum, not long-term transformation.
Economists say that Greece needs much more investment to improve competitiveness. Political analyst Nick Malkoutzis points out that many of the changes are surface-level.
The EU’s Recovery and Resilience Facility has provided significant financial support, but that will taper off after 2026. Without deep structural changes, the country could struggle to maintain its momentum.
Tourism and construction still dominate large parts of the economy. Both sectors are vulnerable to global conditions and seasonal cycles.
While foreign investments like Microsoft’s data centers and Pfizer’s research hub in Thessaloniki are positive signals, they are not yet broad enough to transform the economic base.
What’s different now compared to ten years ago?
One word: perception. Greece used to be seen as a cautionary tale. Now it is being described by some as a model. The Economist recently listed Greece among the top-performing OECD economies.
Its success is often compared to Germany’s recent stagnation.
During the early 2010s, Germany told Greece to sell islands and slash public spending.
In 2024, Greece posted a surplus while Germany faced budget shortfalls and political tension over fiscal rules.
Greece’s transformation has not been accidental. The country combined austerity-driven discipline with modern economic policies and tax system upgrades.
The reforms didn’t come quickly, but they are now producing clear results.
The next step is to convert that stability into long-term productivity and balanced growth.
With EU recovery funds still flowing, the next two years are critical.
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