The 2025 budget strikes a balance between growth and fiscal stability in an environment of increased challenges, Eurobank says in its weekly financial bulletin entitled "Fiscal Developments 2024 & Budget 2025: Targets, Data and Forecasts.".

The bank said that the Greek economy remains resilient, with expected growth rates significantly above the Eurozone average for both 2024 and 2025.

The 2024 GF primary outcome is expected at 3.0% of GDP, while the forecast for 2025 is at 2.4% of GDP. The budget introduces measures such as the reduction of social security contributions and wage increases aimed at boosting disposable income.

With an emphasis on growth and maintaining fiscal discipline, 2025 emerges as a key year for the country's economic trajectory.

Eurobank presents below a summary of the main points of the 2025 Budget:

1. Economic Developments and the International Environment. Geopolitical tensions (e.g., war in Ukraine), climate change, trade disputes and sovereign debt are key factors affecting global growth prospects.
2. Overview and Prospects of the Greek Economy: The Greek economy maintains its resilience, with growth estimated at 2.2% for 2024 and 2.3% for 2025, exceeding the respective Eurozone forecasts. The labor market continues to strengthen, with the unemployment rate declining from 10.3% in 2024 to 9.7% in 2025, while inflation eases further, from 2.7% in 2024 to 2.1% in 2025. Table 2 below summarizes the current forecasts for the Greek economy along with the 2025 budget forecasts and recent forecasts from official agencies, the current Eurobank research forecast, and the average market forecast (as calculated by Focus Economics) for these variables.
3. Budget FY: According to the 2025 Budget projections, at the FY level, the primary fiscal balance for 2024 is estimated to be positive—a primary fiscal surplus—at €6.03 billion or 2.5% of GDP in 2024 from 2.1% of GDP in 2023 (Table 3). For 2025, the primary fiscal balance is expected to remain in surplus at €5.97 billion or 2.4% of GDP.
4. The overall fiscal balance of the GC for 2024 is estimated to be slightly negative (fiscal deficit) at €1.71 billion or -0.7% of GDP, significantly improved (by about 45% compared to the corresponding value (-1.7% of GDP) for 2023. For 2025, the overall fiscal balance is also expected to be negative but lower in absolute terms at €1.42 billion or -0.6% of GDP. Based on the 12-month 2024 State Budget execution as presented above, we believe that a significant overshooting of the 2025 Budget target for the 2024 primary surplus is possible. We estimate that due to the overrun of the tax revenue target, already mentioned, the primary fiscal balance may approach 3.0% and, correspondingly, the overall fiscal balance may approach closer to 0% of GDP. 
5.  on:Recall that according to Eurostat data and European Commission forecasts (Nov-24), Greece has recorded significant primary surpluses at the level of GDP for 7 years (primary budget deficits were recorded only in 2015 and in 2020-21 (pandemic COVID-19). Also, according to European Commission forecasts (Nov-24), Greece is estimated to record the third highest primary surplus as a percentage of GDP among the 20 euro area member states. It is stressed that creating additional fiscal space by achieving a higher-than-targeted primary surplus can no longer translate into an additional increase in the expenditure of the SG. Under the new euro area fiscal framework, governments are bound by the Medium-Term Fiscal-Structural Plan, which sets specific budgetary targets and expenditure ceilings for the coming years. Even if additional fiscal space is created, the government cannot increase spending beyond the limits already set unless the medium-term plan is revised in agreement with the European institutions. The additional fiscal space can be used exclusively for reducing public debt or creating a countercyclical reserve, as foreseen in the new EU economic governance framework.
6. On the other hand, achieving the budgetary target could allow for changes in the tax scale, provided that revenues in the coming years are not negatively affected.6.Fiscal Interventions: The fiscal interventions for 2025 (as for 2024) are driven by three main axes: a) strengthening disposable income, b) reducing social inequalities, and c) addressing structural challenges such as demographics and housing. At the same time, interventions to address the impact of natural disasters are foreseen, while institutional reforms aimed at improving economic and social stability are being pursued. The total cost of the new interventions for 2025 is estimated at €2.96 billion or 1.2% of GDP (of which €0.63 billion relates to a reduction in DG revenue), registering an increase of €1.12 billion compared to 2024. The interventions include both revenue-easing measures (totaling €0.63 billion), such as tax and social security contribution reductions, and expenditure-enhancing measures (totaling €2.33 billion), with targeted social transfers and support to affected sectors.
7. Public Debt. According to estimates, the debt of the GS is expected to reach €365 billion in 2025, holding steady in absolute terms compared to the 2024 estimate (Table 3). As a share of GDP, government debt is expected to decline to 147.5% from 154.0% in 2024 and 163.9% in 2023. The debt management strategy focuses on maintaining portfolio stability, with an emphasis on extending maturity and reducing borrowing costs. Debt maturities extend to 2070, while the gradual replacement of loans with new bonds is expected to enhance the resilience of Greek debt to changes in interest rates. The public debt management strategy for 2025 is geared towards maintaining sustainability, with the key objectives of reducing servicing costs, maintaining a high proportion of fixed-rate debt, and ensuring favorable borrowing conditions in international markets. On the guarantee front, the Greek State maintains an active role in supporting private sector financing and investment. The total guarantees provided through the Hercules scheme for the management of banks' non-performing loans amount to €19.17 billion, with an estimated outstanding balance of €16.35 billion by the end of September 2024.