There may be only one good reason not to choose Greece for vacation this year: the whole planet is likely to be there.
Tourists are returning in force to the country after the hiatus caused by the pandemic. In 2022, Greece welcomed 27.8 million tourists. It should receive even more this year and exceed the record of 31 million visitors set in 2019. The country has 10 million inhabitants.
This is good news for the economy of the country, where tourism accounts for 20% of gross domestic product (GDP). And it’s not the only one. After coming close to bankruptcy, Greece has resumed the path of growth, at an accelerated pace.
It would be wrong to speak of a “Greek miracle”. This revival is nothing short of miraculous. It was rather painful for the population, which paid for the carelessness of its leaders. In 2008, Greece found itself in default on a debt that had been growing since the country entered the European monetary union. The International Monetary Fund and other European countries came to its rescue, but imposed spending restrictions that were deemed unacceptable by the Greek government. The population even overwhelmingly rejected a European aid plan in a referendum, which almost caused the break-up of the euro zone.
Backed against the wall, the country ended up bowing to the demands of its creditors. A decade of misery followed. During this period, the Greeks became impoverished, the unemployment rate exploded and young people fled the country by the thousands.
Until 2022, the government was under the watchful eye of the European Commission, which wanted to ensure that the reforms imposed were put in place and delivered the expected results.
The rescue of the country and the European Union was painful and expensive, around 300 billion euros. But he seems to have succeeded, at least in good part. Greece has not solved all its problems. The unemployment rate has gone down; at 11%, it is no longer the highest in the euro zone. But high inflation hurts a lot. And the country still needs the support of loans at very low rates granted to it by its creditors.
Greece remains the most indebted country in Europe, but its public debt has fallen from 195% of GDP to 171% of GDP over the past year, a rapid reduction that astonishes all observers.
The country experienced one of the strongest economic growths in Europe last year and should do better than the average of the member countries again this year and next year. Tourism has something to do with it, such as increased public and private investment and better management of public finances.
The country is about to come back into the sights of major international investors. His credit rating, which fell to rock bottom in the wake of the debt crisis, gradually rose. It is about to cross the threshold from “speculative” category to “investment” category, the highest granted by major rating firms1.
Now freed from the tutelage of its creditors, Greece could relax the fiscal discipline and tight governance it had to show to get out of the hole. However, it seems that the crisis has left its mark. The country has just re-elected a majority of the Conservative government, which prides itself on having put the economy back on the right track.
