At pre -crisis levels (2009) will be reduced in 2026 public debtas the draft of the new budget has shown, and the goal is to repay the loan of the 1st Memorandum a decade earlier than the final date so that debt is reduced.
Public debt will be 359 billion euros next year or 137.6% of GDP (a 7.8 -percentage points reduction of GDP compared to 2025), when it was 147.8% of GDP in 2010, when the country received the first rescue package. An evolution, which is also due to the fact that in December is expected to be implemented New premature repayment of GLF’s European loanswhich have a floating rate, with the proportionate repayment of loans expiring in the years 2033 – 2041, totaling EUR 5.29 billion.
It has been preceded by loans of € 7,935 billion in December 2024, other € 5.29 billion in December 2023 and EUR 2,645 billion in December 2022. These are loans of the first Memorandum, which constitute the highest burden on the debt portfolio.
Now, the main objective is to repay these bilateral loans a decade earlier than their final expiration date, no later than 2031so that public debt is reduced both as an absolute size and a percentage of GDP.
The Ministry of National Economy and Finance is seeking to exploit current fiscal stability and favorable market conditions. And to signal that the country is not merely seeking to meet its obligations, but to regain complete autonomy and reliability, creating conditions for lower borrowing costs in the future.
According to ministry officials, early repayment has multiple benefits:
- Reduce interest costs and limiting debt service costs.
- Strengthening credibility, as markets and rating agencies will receive the message that the country actively manages its debt and not just through elongation.
- Restriction of refinancing risk and reducing exposure to possible future upheavals internationally.
- Creating a fiscal space due to the reduction of interest costs.
Finally, based on the Ministry’s plan, the prospect is to retreat public debt below 100% of GDP by 2035. With IMF forecasts converging that in 2030 Greece will have a debt of 125% of GDP- lower than Italy- which, as the ministry’s agents point out.