Surprise from ELSTAT data showing a much higher than targeted primary surplus and debt reduction to 161.9%. Four positive figures from the Ministry of Finance.

According to the data, the primary surplus reached 4.01 billion euros, or 1.9% of GDP, compared to zero in the previous year. GDP rose to 220.3 billion euros in 2023, compared to 206.6 billion euros in 2022 and 181.5 billion euros in 2021.

Greek debt fell from 356.8 billion euros at the end of 2022 to 356.7 billion euros at the end of 2023, according to ELSTAT data. The reduction is marginal in absolute terms. However, it is significant as a percentage of GDP. Specifically, it is reduced to 161.9% of GDP at the end of 2023 from 172.7% of GDP in 2022.

The Ministry of National Economy and Finance commented that the resilience of the Greek economy and sound fiscal policy led to the achievement of the fiscal targets for 2023.

As announced by the Hellenic Statistical Authority, the general government primary balance for 2023 amounted to 1.86% of GDP, compared to a target of 1.15% of GDP included in the introductory report of the budget. Compared to the 2024 budget targets, there was an excess of net tax revenue of EUR 292 million in the last quarter of 2023 and of EUR 647 million in January-February 2024, recorded in fiscal 2023, while there was a restraint in general government expenditure of EUR 602 million.

This positive outcome is evidence of the dynamism of the Greek economy, as well as the gradual benefits of the reduction in tax evasion. It is indicative that in the months of January and February, out of the EUR 647 million overrun, EUR 397 million came from the payment of income tax by legal persons.

FOUR BENEFITS FOR THE ECONOMY 

The primary surplus overshoot is reflected in 4 areas:

1) The faster pace of reduction of the government debt. On the basis of the above result, the debt-to-GDP ratio will fall from 172.7% in 2022 to 161.9% in 2023.

2) The creation of a better starting point for the achievement of the fiscal targets in 2024, despite the international turbulence and the slowdown in international and European growth rates,

3) The debt limit will increase the flexibility of the four-year fiscal plan.

4) This result sends a strong signal to international markets that the Greek economy is strengthening and growing beyond its targets, despite the difficulties and extraordinary events the country faced last year (natural disasters, international crises, double national elections, etc.).