- A report by Handelsblatt on the Greek development model that raises questions about sustainability is hosted by DW. Read the story…
A X-ray of the Greek development model and the questions it raises about its sustainability can be read in a report from Athens by the financial newspaper Handelsblatt. The Greek economy has grown at twice the speed of the average of the 27 EU member states since the pandemic, but the Greek public debt remains enormous, the report reminds us.
“Greece needs significantly higher investments for the sustainable development of its economy. However, the increase in investments is falling short of expectations. Thus, according to data from the last quarter, investments in Greece fell by 3.2% compared to last year,” the publication states, among other data that capture the overall picture.
“The gap with the rest of the EU member states is growing. Greece has the lowest investment rate in the EU. The first quarter of 2025 was 14.8% of GDP. Last year it was still 15.34%, while the European average is 21.2%. The fact that the Greek economy is still growing strongly (despite the decline) is mainly due to the increasing tourism development and private consumption.”
According to Commission data, to which the report refers, the low overall growth rate is due to various factors: “polygamy, time-consuming licensing procedures, high energy costs, infrastructure deficits, lack of specialized personnel and difficult financing conditions.”
Also of interest is the fact that to date, “according to analysts at the Greek Eurobank, the investment gap since the crisis years is estimated at 87 billion euros. So far, only 13.2 billion euros have been covered.” As the report notes, this very investment gap brings to the surface “chronic structural weaknesses of the economy, affecting mainly small businesses,” which face problems of low capital and liquidity.
As the report notes, in recent years, “the Greek real estate market has been attracting foreign investors (…) but this growth is not sustainable” and is mainly the result of “the Golden Visa program, which promises a Schengen visa to buyers from countries outside the EU.” Nevertheless, the Commission notes in its latest report that “the Greek business environment is becoming ‘increasingly friendlier’” thanks to the reform of bankruptcy law and the digitalization of administration.
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