Athens, June 15 – The German financial newspaper Handelsblatt, in a detailed report by journalist Gerd Höhler, highlights Greece’s strategy for reducing public debt and strengthening its credibility in international markets. This comes as Greece proceeds with a new early repayment of loans from its crisis-era support programs.
Greece Repays €6.95 Billion in Early Debt
The newspaper notes that Greece is today making an early repayment of 6.95 billion euros from loans under the second bailout program, continuing a policy it has been implementing since 2022. As highlighted, the total value of early repayments will now amount to 33.45 billion euros.
Minister Pierrakakis’s Strategy for Debt Reduction
According to the publication, the Minister of National Economy and Finance and President of the Eurogroup, Kyriakos Pierrakakis, aims through early repayments to limit the cost of debt servicing, further reduce the debt-to-GDP ratio, and strengthen investor confidence in the country.
Handelsblatt emphasizes that Greece seeks through early repayments to avoid future pressures on public finances, as favorable arrangements agreed during the debt crisis are set to expire from the beginning of the next decade. At the same time, it links the early repayment strategy with the maintenance of the investment grade that Greece regained in the last two years, as well as with the country’s effort to secure further upgrades from international rating agencies. As noted, the policy pursued by Athens aims not only to reduce debt but also to create an additional ‘safety cushion’ in view of the increased financing needs expected to emerge after 2032.
Significant Improvement in Fiscal Figures
The report makes special mention of the spectacular improvement in the country’s fiscal figures in recent years, noting that Greece is on a path of rapid de-escalation of its debt. As stated, if government forecasts are confirmed, the country may soon cease to be the most over-indebted economy in Europe, with Italy taking the top spot in terms of debt-to-GDP ratio. Furthermore, if Greece manages to reduce its debt-to-GDP ratio to approximately 115% by the end of the decade, it could then positively surpass even countries such as France and Belgium.
Tangible Benefits of Early Repayments
The newspaper notes that the strategy of early repayments is already yielding measurable benefits for public finances. Citing data provided by Kyriakos Pierrakakis, it states that these actions will save a total of 795 million euros in interest, while the repayment being made today alone is expected to reduce the annual cost of debt servicing by approximately 100 million euros and reduce the debt-to-GDP ratio by 2.5 percentage points.
Greece: A Model of Fiscal Consolidation
Finally, the publication concludes that Greece, which was at the epicenter of the European debt crisis fifteen years ago, is now attempting to become an example of fiscal consolidation and active management of public debt. It attributes a central role to Mr. Pierrakakis in implementing the strategy of early repayments and debt reduction.
Source: https://www.newsbeast.gr/financial/arthro/13168667/handelsblatt-o-ellinikos-dromos-exodou-apo-tin-pagida-tou-chreous-i-athina-einai-paradeigma-dimosionomikis-exygiansis
