New factsheet: “A brief history of Greek debt”

In 2009, Greece’s ballooning budget deficit raised concerns about the sustainability of the country’s debt. This triggered a crisis that lasted almost a decade. It led to three adjustment programmes agreed with the European Commission, the ECB and the International Monetary Fund (IMF), led to the largest sovereign default in history, cost around a quarter of Greek GDP and pushed the unemployment rate to a peak of 28 per cent. Given that Greece’s general government debt has exceeded 350 billion euros in recent years and the debt-to-GDP ratio reached 160 per cent of GDP in 2023, the question is often asked whether the country is still vulnerable and at risk of another crisis. This paper outlines the reasons why the current situation is different from 2009. It also presents the key variables that show that Greece’s public debt is not such a pressing concern as long as prudent fiscal policies remain in place.

Click here to read the fachtsheet.