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October Messages

Alex Patelis - Chief economic adviser | Office of the Prime Minister | Hellenic Republic

1. The draft 2023 budget was published and foresees a 1.7% primary deficit for 2022, smaller than

the 2% originally envisaged, with a return to a primary surplus of 0.7% in 2023. Our growth

projections remain unchanged at 5.3% and 2.1% respectively.

At a time of great global uncertainty, we continue to believe consistency, predictability and

transparency are critical in maintaining and building investor credibility, on the road to investment

grade in 2023.

2. However, debt/gdp does not just depend on budget balances. In 2022, Greece is projected to

have one of the largest --if not the largest-- drops in debt/gdp in the world. And in 2023, debt/gdp

should drop below its 2012 level. The denominator matters, and this is not just inflation, but also

faster real economic growth, with the policies of the government (structural reforms, tax cuts,

attracting investment etc) beginning to bear fruit.

To those who keep asking us how Greece could handle a recession in Germany or other countries,

we take note of the following chart:

Since the pandemic started, GDP has expanded 5pp in Greece, against a stagnant economy in


The most recent EU sentiment survey also displays resilience:

3. Drawing inward foreign investment remains a key component of the government's strategy, and we salute Google’s recent announcement to build a new cloud region in Greece, as well as centres of Excellence on AI & Sustainability in collaboration with Deloitte, and a partnership with the 2

Ministry of Culture. Greece is now one of the few countries in Europe to have attracted the big 3 of cloud service providers, AWS, Microsoft & Google.

4. Having completed its milestones and targets, Greece became one of the first EU countries to formally submit a request for the second tranche of its RRP amounting in total to €3.56 bn. Greece 2.0 is going well: total absorption through end-Sep amounts to €1.65bn. Meanwhile, the loan segment has already reached its yearend target. 107 investment plans with a total budget of €4bn have already been submitted, of which 13 investment plans with a total budget of €1bn and an average interest rate of 0.8% at the contract stage.

5. At the EU level, the Prime Minister’s proposal for a cap on the price of TTF natural gas –first expressed in a letter to the President of the Commission dated 9 March 2022– has now been formally adopted by the Commission. We look forward to the outcome of this process. (The PM’s chief energy adviser Nikos Tsafos twitter deserves a follow for those interested in this debate).

Last Friday Greece reached a major energy milestone: for the first time, the country's electricity

system generated enough renewable energy to meet its entire needs for 5 straight hours.

I leave you with a podcast of yours truly on the Google announcement –and other investments– at

Till next time,



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