Growth rate of 2.2% for 2024 and 2.3% in 2025, inflation of 2.7% for this year and 2.1% for next year, primary result of General Government 2.4% in 2024 and 2.5% in 2025 and new permanent fiscal measures amounting to 1.1 billion euros, foresees, among other things, the draft of the state budget of 2025 which was submitted today for discussion in the Permanent Committee of Economic Affairs of the Parliament.

In his statement, the Minister of National Economy and Finance emphasized: “Budget 2025 sends a message of optimism! It has 12 different wage increases and 12 tax cuts. It confirms that our economy will grow much faster than the European Union average. And that unemployment will fall even more. The government is doing another important step towards the full fulfillment of her pre-election commitments!”

Growth rate of 2.2% in 2024 and 2.3% in 2025

In the relevant letter to the members of the Standing Committee on Economic Affairs of the Parliament, the Minister of National Economy and Finance Kostis Hatzidakis and the Deputy Minister Thanos Petralias state:

“The 2025 draft budget is being submitted at the same time as the submission to the Council of the European Union and the European Commission of the first Medium-Term Financial-Structural Plan 2025-2028 (MDS) based on the new European economic governance framework. Therefore, the macroeconomic and fiscal figures reflected in the draft are in harmony with the estimates of the MDS.

In the last three years, the global economy has faced successive crises due to interconnected economic, climatic and geopolitical disturbances. Despite signs of recovery, the international economic environment is characterized by increased uncertainty linked to recent geopolitical developments in the Middle East, the protracted war in Ukraine as well as short-term factors such as tight monetary policies and the reduction of fiscal support internationally following the pandemic and the energy crisis, but also with the significant and accelerating effects of climate change.

In this unfavorable and uncertain international environment, the Greek economy is proving to be resilient. The growth rate expected to rise to 2.2% in 2024 and 2.3% in 2025 against 0.8% and 1.4%, respectively, estimated for the Eurozone, based on the spring forecasts of the European Commission.

Investment is expected to increase by 6.7% in 2024 and 8.4% in 2025 and the unemployment rate to decrease from 10.3% in 2024 to 9.7% in 2025. The Gross Domestic Product (GDP) in nominal terms in 2025 it is expected to increase by approximately 10 billion euros and the ratio of the General Government’s debt to GDP to decrease by 4.6 percentage points. The consumer price index is estimated at 2.7% in 2024 and is expected to decelerate further to 2.1% in 2025.

The draft budget 2025 includes all the interventions that have been announced, including those presented at the Thessaloniki International Exhibition. Ta new permanent fiscal measures that affect the regular budget bring additional fiscal costs in 2025 compared to 2024, amounting to 1.1 billion euros, while a number of other interventions are financed by resources of the Public Investment Program (PIP) and the Recovery and Resilience Fund (Recovery and Resilience Fund). In this context, investment expenditure is expected to increase from 13.1 billion euros in 2024 to 14.3 billion euros in 2025, plus the resources of the TAA loan arm.

The new fiscal interventions, complemented by a series of institutional measures, focus on supporting disposable income, boosting investment and innovation, addressing the demographic and housing issues as well as addressing the challenges of climate change.

The interventions are within the fiscal targets set in the MDS, as net primary expenditure is expected to increase by 3.6% in 2025 compared to 2024, while the relevant target amounts to an expenditure increase of up to 3.7%. In this context the primary result of the General Government is expected to be 2.4% in 2024 and 2.5% in 2025 and the overall result to -1.0% in 2024 and -0.6% in 2025.

The 2025 budget is called upon to reconcile the goal of fiscal stability with the need to increase the disposable income of citizens as well as to address contemporary challenges, such as the demographic and housing problem, the climate crisis, and also to cover the necessary expenses to strengthen the National Defense.

The aim is to ensure the strong development of the Greek economy, the further upgrading of the country’s creditworthiness and the well-being of the citizens, for the achievement of which the channeling of the limited fiscal resources is required with the maximum possible economic and social efficiency”.

See the draft budget here