IMF "limits" Greece's economic growth - Forecasts 2.1% expansion in 2025, slowdown in the medium term
Greece's economy is forecast to grow by 2.1% in 2025, driven mainly by investment, the International Monetary Fund mission said, adding that any crisis in major eurozone countries, as well as global uncertainties, could hamper growth.
This compares with a Greek government forecast of 2.3% for this year.
In the medium term, growth is projected to slow to around 1.25% due to demographic challenges and slow productivity growth, the Fund said in a statement.
The current account deficit is expected to gradually narrow below 4% of gross domestic product over the medium term, the IMF said, with imports set to slow along with the rollout of post-COVID-19 recovery funds by the European Union.
"The primary surplus is expected to remain high at around 2.5% of GDP in 2025, as reduced revenues from an additional cut in social security contributions are expected to be largely offset by gains from reforms aimed at reducing tax evasion and increasing tax compliance," the report explains.
The IMF, one of Greece's official lenders during the debt crisis that erupted in late 2009, urged the country to accelerate structural reforms to help boost public investment.
"It is essential to protect non-pension social spending, such as healthcare and education, to foster inclusive growth, while increasing efficiency," the Fund stressed.
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