IMF for Greece: Debt to fall to 130.2% of GDP by 2030 even with smaller budget surpluses

The International Monetary Fund (IMF) forecasts a sharp diminution successful Greece’s nationalist debt by 16.5 percent points implicit the adjacent 5 years — adjacent if primary fund surpluses are smaller than those targeted by the authorities — according to its latest Fiscal Monitor report.

The IMF projects that Greece’s debt-to-GDP ratio volition autumn from 146.7% successful 2025 to 130.2% successful 2030, arsenic the state maintains a dependable fiscal way with consistent yearly superior surpluses.

However, the Fund expects lower superior surpluses than the authoritative authorities estimates — contempt the information that, implicit the past 3 years, Greece has regularly outperformed its fiscal targets.

Specifically, for 2025 the IMF projects a primary surplus of 3.2% of GDP (vs. 3.6% estimated by Athens), and for 2026, 2.3% (vs. 2.8% successful the caller authorities budget). Thereafter, surpluses are expected to beryllium 1.8% for 2027–2028, 1.9% successful 2029, and 2.0% successful 2030.

Despite these smaller surpluses, the IMF considers them sufficient to guarantee continued indebtedness reduction and manageable financing needs for the Greek government.

No Concern Over “Small” Deficits and Extra Spending

While superior balances stay positive, the overall fiscal balance (including involvement payments) is expected to amusement small deficits. The IMF projects a zero equilibrium successful 2025, followed by deficits of –0.8% of GDP successful 2026 (compared to Athens’ forecast of –0.1%) and –1.4% from 2027 onward.
The Fund stresses that these humble deficits do not endanger fiscal stability and are linked chiefly to higher spending connected maturation initiatives and societal support.

Revenues: Resilient Despite Tax Cuts

Interestingly, the IMF foresees public revenues rising to 50% of GDP successful 2026, adjacent aft caller tax alleviation measures worthy €1.76 billion aimed astatine supporting the mediate class. This implies that economic enactment and the taxation base volition proceed to expand, offsetting losses from little taxes. Revenues are past expected to gradually autumn to 46.8% of GDP by 2030, apt reflecting further taxation reductions.

Public expenditures are projected to travel a akin way — expanding to 50.8% of GDP successful 2026, earlier declining to 48.2% successful 2030.

IMF’s Overall Assessment

The IMF acknowledges Greece’s significant progress successful indebtedness simplification and fiscal discipline, portion informing that challenges remain. Sustaining fiscal stableness and boosting growth and productivity are seen arsenic key conditions for durable improvements successful surviving standards.

It is besides noted that the IMF calculates indebtedness differently from the European Commission, which explains the saltation betwixt their estimates.