Greece’s economy is experiencing notable growth, boasting a rate above two percent and a budget surplus exceeding six billion euros. However, widespread public discontent persists due to stagnant wages and rising living costs, prompting significant protests. Prime Minister Mitsotakis faces declining support despite maintaining trust regarding economic stability. While various sectors thrive and reforms are underway, many citizens feel excluded from the recovery, raising concerns about potential unrest amid ongoing governmental debt.
Greece’s Economic Growth Amidst Public Discontent
After enduring a prolonged financial crisis, Greece’s economy is on a path of steady growth. However, a rising wave of dissatisfaction among the populace towards the government raises questions about why the economic upswing is not benefiting everyone.
Impressive Economic Indicators
It’s often said that numbers tell a compelling story, and in Greece’s case, they seem to highlight a positive trend. While Germany’s economy is showing signs of weakness, Greece is celebrating a growth rate exceeding two percent this year, far surpassing the EU average. Instead of the anticipated budget deficit of 2.2 billion euros, the nation is now enjoying a surplus that exceeds six billion euros. Prime Minister Kyriakos Mitsotakis recently shared plans to expedite the repayment of a portion of the debts incurred during the financial crisis.
Next year, projections indicate that Greece’s debt-to-GDP ratio will dip below 150 percent. Although this figure remains high within the EU, it marks a significant improvement from the staggering 200 percent recorded four years prior.
Despite these promising statistics, a wave of nationwide protests erupted recently, with tens of thousands of Greeks taking to the streets. Various professional organizations had called for a general strike, which temporarily disrupted daily life across the country. The underlying issue: escalating financial concerns. “The cost of living has skyrocketed,” stated Yiannis Panagopoulos, leader of the prominent private sector union (GSEE). “Our salaries are stagnant, while exorbitant housing costs have plunged young people into dire straits.”
Indeed, this economic recovery has yet to reach many citizens. Significant reductions in wages and pensions during the financial crisis have not been restored to pre-crisis levels, even as the prices for essentials like food and housing have surged. Many citizens are voicing their frustration, accusing the government of insufficient action against inflation, particularly in terms of salary and pension adjustments.
Shifting Political Landscape and Public Trust
The dissatisfaction is reflected in the declining poll ratings for Mitsotakis and his New Democracy party. Following a strong showing of 41 percent in the 2023 parliamentary elections, support has dwindled, with only 28 percent in the recent European elections and even lower in the latest surveys. Although there is currently no formidable opposition, right-wing parties such as the “Greek Solution” are gaining traction.
Despite these challenges, Mitsotakis maintains a high level of trust among citizens regarding economic stability. Under his leadership, Greece has restored its credibility in international financial markets, leading to upgrades from rating agencies and attracting interest from both foreign and local businesses.
As the Greek economy continues to flourish, with growth in sectors beyond tourism—such as pharmaceuticals, arms, and mining—construction activity has surged. Increased revenues from trade taxes and the sale of public assets, like highways and airports, have significantly bolstered the national budget. Furthermore, the government has made strides in combating illegal payments through digital oversight, ensuring that transactions above 500 euros are no longer conducted in cash. Citizens are also required to document a portion of their income, roughly a third, which is automatically recorded during card transactions, streamlining tax reporting.
Aware of the potential unrest on the streets, Mitsotakis has outlined a three-year plan that includes various social commitments, such as tax relief, financial support for homebuyers, and enhancements in healthcare. The minimum wage is set to gradually increase to 950 euros, alongside promises to adjust pension rates.
While Greece’s financial landscape shows signs of improvement, the government remains heavily indebted. However, as the economy strengthens and governmental achievements are celebrated, the patience of the populace may wear thin if they feel excluded from the benefits of this upward trend.