The picture painted by the IMF regarding the future of European debt does not exactly inspire optimism. <\/p>\n
The Fund\u2019s Managing Director, Kristalina Georgieva, warned that without immediate action, the situation could spiral dramatically by 2040. <\/p>\n
\u201cWithout measures, we estimate that the simple average of public debt in EU countries would more than double to over 130% of GDP in 2040,\u201d he noted. <\/p>\n
The Fund sees an explosive combination of pressures weighing on government budgets. Increased needs for pensions<\/strong>, healthcare<\/strong>, energy transition<\/strong>, and especially new defense spending<\/strong> are creating an explosive economic landscape for most European governments. <\/p>\n According to the IMF chief, the total additional cost of these sectors could reach 5% of GDP by 2040. In fact, she made it clear that many countries will be forced to make difficult decisions. <\/p>\n \u201cCountries that lack fiscal space will have to increase their defense spending in a fiscally neutral manner,\u201d he said, leaving open the possibility of new tax burdens or cuts to other public spending. <\/p>\n Amid the bleak European landscape, Greece<\/strong> is one of the few exceptions. The IMF forecasts that Greek public debt will continue to decline steadily in the coming years. <\/p>\n According to forecasts, Greek debt will fall to 110.9% of GDP in 2031<\/strong>, down from 145.7%<\/strong> last year. At the same time, countries such as France<\/strong> and Belgium<\/strong> are expected to see their debt skyrocket. <\/p>\n French debt is projected to reach 120.7% of GDP<\/strong>, while Belgian debt is projected to reach 122.3%<\/strong>. Even Finland<\/strong>, which had previously taken a hard line against Greece during the years of the memoranda, is expected to see its debt rise above 100% of GDP. <\/p>\n It is noteworthy that Greek debt is estimated to be even lower than Italy\u2019s, which is projected to reach 136.1% of GDP<\/strong>. <\/p>\n The IMF attributes the significant improvement in Greece\u2019s outlook to specific factors. Among them are the strong growth of recent years, the primary surpluses<\/strong>, the low average borrowing rate, and the long debt repayment period. <\/p>\n The active management of Greece\u2019s debt obligations also played a decisive role, such as the early repayment of loans to the IMF and the accelerated repayment of intergovernmental loans under the first memorandum. <\/p>\n The Fund also notes that Greece is not under the same pressure as other European countries regarding defense spending. Military spending is already at high levels, at approximately 2.9% of GDP<\/strong> for 2025, and is expected to remain relatively stable over the next decade. <\/p>\n At the same time, the pension reforms implemented in recent years are expected to gradually ease the pressure on the pension system. <\/p>\n The International Monetary Fund insists that without deep reforms, Europe will struggle to contain its debt. <\/p>\n Kristalina Georgieva placed particular emphasis on completing the single European market and boosting growth, which remains sluggish in many economies. <\/p>\n \u201cFor the average European economy, even structural reforms that moderately boost growth could reduce the necessary fiscal adjustment by about one-fifth,\u201d he emphasized. <\/p>\n","protected":false},"excerpt":{"rendered":" \n The picture painted by the IMF regarding the future of European debt does not exactly inspire optimism.<\/p>\n The Fund\u2019s Managing Director, …<\/p>\n","protected":false},"author":1,"featured_media":10492,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7],"tags":[],"class_list":["post-10491","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy"],"acf":[],"_links":{"self":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts\/10491","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10491"}],"version-history":[{"count":0,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/posts\/10491\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=\/wp\/v2\/media\/10492"}],"wp:attachment":[{"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10491"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10491"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.tomanifesto.gr\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10491"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}} IMF: Greece is turning a \u201cnew page\u201d <\/h2>\n
The reasons why Greek debt is declining <\/h2>\n
The reforms demanded by the IMF <\/h2>\n