Greece’s public debt is projected to return to 2009 levels by 2026, according to the Ministry of Finance and Economy following the release of the new draft budget, which also anticipates a 2.4 percent economic growth.
The draft budget estimates that in 2026, public debt will stand at 359 billion euros, or 137.6 percent of GDP—a notable decline of 7.8 percentage points compared to the 2025 projection.
In 2010, when Greece entered the first bailout program, as it had come close to bankruptcy, public debt stood at 147.8 percent of GDP.
This development is largely due to the fact that in December, Greece will proceed with a new early repayment of the European Greek Loan Facility loans, which have a floating interest rate. The proportional repayment of loans maturing in the years 2033-2041, totaling 5.29 billion euros is expected to be implemented
In December 2024, the Greek government proceeded with repayment of loans amounting to 7.935 billion euros. Previously, on December 2023, Greece made loan repayments of 5.29 billion euros. In December 2022 the loan repayment amount was 2.645 billion euros.
These are loans from the first rescue agreement signed in 2010, which constitute the largest weight in the Greek public debt portfolio.
Loan repayments before final maturity date
According to the Ministry of Finance and Economy, Greece’s main goal is to repay these bilateral loans a decade earlier than their final maturity date, meaning by 2031 at the latest, so that the public debt is reduced both in absolute terms and as a percentage of GDP.
The ministry seeks to take advantage of the current fiscal stability and favorable international market conditions. Greece also wants to send a signal that the country is not simply seeking to cover its obligations, but to regain full financial autonomy and credibility, creating conditions for lower borrowing costs in the future.
As ministry officials report, early loan repayment has multiple benefits:
Reduction in interest costs and limitation of debt service costs.
Enhancement of Greece’s credibility, as markets and rating agencies will receive the message that the country is actively managing its debt and not simply through extensions.
Limiting refinancing risks and reducing exposure to possible future international turmoil.
Creating fiscal space, due to the reduction in interest costs.
Based on the ministry’s plan, the outlook for Greek public debt is to drop to below 100 percent of GDP by 2035. With International Monetary Fund forecasts converging that in 2030 Greece will have debt at 125 percent of GDP – a lower percentage than Italy – a fact which, as ministry officials point out, reflects progress in consolidating the country’s fiscal figures.
