The International Monetary Fund predicts Greece’s debt will continue to fall
Primary surpluses from 2023 and maintaining the downward trajectory of the debt predicts for Greece the International Monetary Fund with its report on global fiscal developments (Fiscal Monitor).
The Fund foresees a primary surplus of the general government 0.9% of GDP – which is expected to gradually increase after 2023 and reach the 2% in 2027 – against a primary deficit of 1.8% this year and 5.5% in 2021.
The total balance of the general government, which also includes interest on servicing the public debt, is expected to have in 2023 a deficit of 1.9% of GDP against a deficit of 4.4% this year, while it is predicted to gradually decrease to 0.7% in 2027.
The Government revenue expected to decrease from 47.6% of GDP this year to 45.9% in 2023 and further on 43.6% in 2027 against a reduction in public spending from 52% this year to 47.8% and 44.3%, respectively.
The debt tof the general government is projected to decrease from 199.4% of GDP last year to 177.6% this year and 169.8% in 2023, with a gradual further decrease in 149.9% in 2027.
Debt and deficits declined globally in 2021 in 2022, due to the end of pandemic support measures and runaway inflation, but remain higher than pre-pandemic levels and forecasts.
The global public debt it is projected to reach 91% of GDP in 2022 and remain approximately 7.5 percentage points higher than pre-pandemic levels.
For most countries, he points out, this means they will have to maintain tight fiscal policy.
In this context, the Fund reiterates its recommendation that support measures to protect against high energy and food prices be targeted to the most vulnerable. “In some countries, this may include providing discounts on energy bills (for essential use) to vulnerable low- and middle-income households,” it says.
He is also in favor of creating fiscal “cushions” for a quick and flexible response to crises, while he believes that measures that have proven effective during the pandemic, such as programs to support employment, can be used.
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