Since Prime Minister Kyriakos Mitsotakis and his party, New Democracy, took power in 2019, Greece has embarked on a series of ambitious reforms aimed at restructuring the country and its institutions, post crisis. It has also sought to lure international investors back to the country. Despite the past few years challenges such as Covid, the war in Ukraine and inflation, the government has remained focused and has continued to deliver on its mandate. In 2021, Greece filed an ambitious plan with the EU, Greece 2.0, part of the EU’s Next Generation and Recovery and Resilience Facility (RRF), designed to mitigate the impact of the pandemic and to prepare economies for sustainable growth. Greece has hence been able to continue to fund the modernisation of its infrastructure and economy following receipt of EUR 3.6bn as part of the first tranche and EUR 3.56 bn from the second tranche. The second tranche was made available once the country met the 25 milestones set out in its plan, which included, among others, investments into energy and urban regeneration. Now that Greece has demonstrated its success at managing the first part of its turnaround strategy, what does the plan look like going forward?
Turnaround strategy part two
Politically, the country will hold an election in June next year, in which all seats in the Hellenic Parliament will be contested. PM Mitsotakis has stressed numerous times that his government needs two terms to fulfil its planned reforms. A change of government now, with the left-leaning opposition party Syriza taking the lead, would impair the recovery strategy. New Democracy is credited today with 10-point lead over Syriza.
Economically, the international energy sector and Greece’s role within it, are key. As the EU attempts to diversify away from Russian energy, the Eastern Mediterranean region is set to become a major focus of the European energy strategy, with Greece playing a strategic role as the gateway to the EU.