A sharp reduction in Greece’s public debt in 2026, is expected to extend through to 2031 – driven by high primary fiscal surpluses, is forecast by the International Monetary Fund (IMF) in its Fiscal Monitor report released today, reported the General Secretariat for Public Diplomacy and Greeks Abroad
At a time when public debt in advanced economies has risen to 180 per cent of GDP in 2025 and is expected to continue on an upward path, reaching 114.8 per cent by 2031, Greece’s debt is projected to fall significantly over the same period—from 145.7 per cent of GDP to 110.9 per cent, that is, below the average.
Greek debt is expected to decline to 136.9 per cent in 2026 and to 130.9 per cent in 2027, continuing its downward trajectory through to 2031, which is the final year of the IMF’s projections. At the forefront of rising debt among advanced economies are the United States, whose debt is expected to surge from ne 123.9 per cent in 2025 to 142.1 per cent in 2031. Eurozone debt is also projected to increase, but at a more moderate pace, reaching 89.7 per cent in 2031 from 87.1 per cent in 2025.
Greek debt is expected to decline to 136.9 per cent in 2026 and to 130.9 per cent in 2027, continuing its downward trajectory through to 2031, which is the final year of the IMF’s projections.
Globally, public debt rose to 94 per cent of GDP in 2025 and is projected to reach 100 per cent by 2029—one year earlier than the IMF had expected just a year ago—with the increase in China’s debt playing a significant role.”Global debt dynamics remain adverse. Although increases are concentrated in China and the United States, vulnerabilities are more widespread,” the Fund notes. The rapid reduction of Greece’s debt is based on primary surpluses, which are expected to gradually decline through to 2031 but remain at high levels.
Specifically, the primary surplus is projected to fall from 4.4 per cent of GDP in 2025 to 3.8 per cent in 2026 and further to 3.1 per cent in 2027, settling at 2.7 per cent in 2031. Over the same period, the Eurozone is expected to run a primary deficit, which will gradually decrease from 1.4 per cent in 2025 to 0.6 per cent in 2031.
As global debt continues on a clear upward trajectory, the IMF warns that the shock from the war in the Middle East requires a disciplined fiscal response from countries. The conflict “heightens global uncertainty at a time of strained public finances, underscoring the need for policies that preserve future stability,” it says.
With debt already high in many countries—following the COVID-19 pandemic and the surge in energy and food prices caused by Russia’s invasion of Ukraine—fiscal support measures must be targeted and temporary, focusing on those most exposed and least able to absorb price increases, the Fund notes.
“Policymakers must recognise that markets are becoming less forgiving. Over the past year, investors have increasingly questioned assumptions of unlimited borrowing capacity—even for large advanced economies.
Episodes of repricing in Japan, the United States and parts of Europe reflect heightened sensitivity to fiscal slippages and weak medium-term frameworks,” the IMF concludes.
