The International Monetary Fund’s (IMF) mission chief for Greece, Juergen Zink Kang, emphasized the need for consistent and sustained implementation of reforms mandated by Greece’s creditors following the bailout programs. While praising Greece’s achievements under the memorandum frameworks, Kang stressed that commitments to creditors must remain a priority.
Greece’s Persistent Economic Challenges
Despite gains in disposable income, Kang noted that Greece’s GDP per capita remains the second lowest in the European Union. Household savings rates are among the lowest in the eurozone, and although the current account deficit has improved significantly, it remains substantial. Investment levels—while rising—are still low relative to EU averages and advancing only gradually.
Reforms as the Path Forward
Kang underscored that correcting these imbalances hinges on implementing structural reforms. He cited the land registry (cadastral system) as a key example—set to become fully operational next year—and highlighted progress against tax evasion. According to Kang, fiscal reforms targeting tax avoidance have been effective: the fiscal space they created allowed the government to reduce social security contributions, thereby boosting disposable income and consumption.
Positive Assessment from the ESM
Robert Blotevogel, coordinator of the European Stability Mechanism’s (ESM) mission for Greece, offered an optimistic outlook. He pointed out that Greece’s growth rate is now double that of the eurozone, and both its budget deficit and public debt are declining rapidly.
To illustrate what would be needed for Greece to achieve 4% annual growth—rather than the current 2%—Blotevogel focused on the structure of Greek businesses. He observed that while some firms operate successfully in export-oriented, high-margin sectors, many others are small, labor-intensive, less productive, and lack the scale or resources to invest meaningfully. He challenged policymakers to experiment with bold, untested ideas capable of lifting overall productivity—particularly those encouraging new firms to take risks, adopt technology, and pursue economies of scale.