Greece’s near-term economic outlook remains favorable, with real GDP sustaining its robust expansion, said the head of the International Monetary Fund (IMF) mission for Greece, Joong Shik Kang, during a press conference on Thursday.
Greece’s real GDP growth is projected to remain at 2.1% in 2025 before moderating in the medium term, according to the IMF.
Investments will continue to be a key driver of growth, supported by projects funded by the EU Recovery Fund (NGEU).
Private consumption will remain strong, backed by favorable employment conditions and rising incomes.
With global energy prices stabilizing, headline inflation is expected to return to its downward path, while core inflation will remain more persistent due to services inflation and wage growth, it also said.
The current account deficit is expected to gradually decline below 4% of GDP over the medium term, as imports are expected to slow due to the gradual completion of NGEU-financed investments.
Challenges
Risks to the growth outlook are balanced, while risks to inflation are elevated.
Potential headwinds include a slowdown in major euro area countries, worsening regional conflicts, and global political uncertainty, the IMF said.
Accelerating ambitious structural reforms could further improve the growth outlook.
Stronger and more persistent than expected wage growth could further boost services inflation, possibly exacerbated by fluctuations in global and regional energy prices.
