S&P Global is the first of the “big three” rating agencies in the world who have upgraded Greece to investment grade. This happened late last week, when Greece’s rating boosted to ‘BBB-/A-3.’ This is a positive sign for Greece’s economy and encourages foreign investment in Greece. Among the reasons why Greece’s rating was upgraded is its stronger budgetary position.
A Growing Economy
In S&P’s announcement, they noted that Greece’s public finances have improved thanks to fiscal adjustments. They add that a lot of progress was made since 2015 to address Greece’s economic and fiscal imbalances.
Greece’s Investment Rating
Where is Greece rated among other rating agencies? Two of the largest ratings companies, Fitch and Moody’s, rank the country just one notch below investment grade. DBRS Morningstar, another rating agency, was the first to upgrade Greece’s rating to investment grade.
More Growth Coming
S&P also notes that it expects “additional structural economic and budgetary reforms, coupled with large EU funds, that will support economic growth in 2023-2026.” Greece expects its economic output to increase by 3% in 2024. This year, the economic expansion in Greece was 2.3%, which was more than twice the average in the Eurozone.
Greece’s Finance Minister, Kostis Hatzidakis, spoke positively about the upgrade to Greece’s credit rating: “The country faces a historic window of opportunity through a combination of the right economic policy mixture with political stability.”
Mitsotakis Speaks
Greek Prime Minister Kyriakos Mitsotakis wrote on social media platform “X” that Greece is planning to continue its agenda of “attracting new investment, creating jobs, and achieving inclusive growth.”
What This Means for Greece
Mitsotakis also noted that as Greek bonds become more attractive, “borrowing becomes easier and cheaper for businesses and households. At the same time, Mitsotakis noted that “the way is being paved for billions in investment funds to be funneled to the country that could not be directed here for 15 years.”
Greece Repays its Loans Early
In other news, Greece plans to repay its 5.3 billion euro loan early. These loans were given to Greece during the first rescue package, and are due to be paid in 2024 and 2025. However, they will be paid on December 15th of 2023. According to the Ministry of National Economy and Finance, Greece plans to make another early repayment in 2024.
