Greece Exits Enhanced Surveillance, Enters New Era

Greece regained more freedom over its economic policy and entered a new era on August 20, leaving behind the European Union’s enhanced surveillance framework and following the early repayment of outstanding bailout loans to the IMF (International Monetary Fund).

Greek Prime Minister Kyriakos Mitsotakis said it was a “historic day”, adding that “a 12-year cycle that brought pain to citizens now closes”.

In a televised address Mitsotakis said Greece was now back on track to growth.

Greek Prime Minister Kyriakos Mitsotakis.

“In the difficult years that preceded our people have suffered a lot. But they have also proven many things. Thanks to their sacrifices, our country swiftly got back on its feet. The mishaps have become lessons of mature responsibility in our political behavior. And when needed, Greek women and men showed trust and joined forces with the state and the responsible stakeholders, against common threats,” he said.

The news was welcomed by the international community and the EU, which praised the country for its progress and for successfully delivering on the bulk of its policy commitments.

“Today marks the last day of the enhanced economic surveillance of Greece. Thanks to the determination and resilience of Greece and its people, the country can close this chapter and look to the future with confidence. The EU will always stand by your side,” said European Commission President Ursula von der Leyen.

European Commission President Ursula von der Leyen.

“Greece has effectively implemented key reforms to strengthen its economy and public finances. Its achievements are even more commendable given that this period has been marked by two severe external shocks: the Covid-19 pandemic and Russia’s invasion of Ukraine,” said European Commissioner for the Economy Paolo Gentiloni.

European Commissioner for Economy Paolo Gentiloni. Photo © European Union – Source: EP

Commenting on the news, Greek Finance Minister Christos Staikouras, said August 20th marks the achievement of a major national goal for Greece, thanks to the sacrifices of the Greek people, the prudent economic and reform-oriented policy consistently implemented by the government, and brings the country closer to achieving its last major goal: recovering “investment grade” credit rating.

Staikouras went on to add that Greece’s exit from the framework strengthens the country’s position on international markets, provides an additional impetus to Greece’s development dynamic and investment potential; gives the government more flexibility over economic policy; and demonstrates the dynamic of the Greek economy despite the unprecedented external difficulties.

Greek Finance Minister Christos Staikouras. Photo source: @cstaikouras

Greece entered “enhanced surveillance” in 2018 after three bailouts from 2010 to 2015 by the EU and the IMF valued at over 260 billion euros.

Since then, the country’s economic policy and reform progress have been monitored. From now on, the Greek economy will be subject to assessment every six months until it repays 75 percent of its loans. This ‘simpler’ form of surveillance will continue until 2059.

Since exiting the bailouts in 2018, Greece has relied solely on the markets for its financing needs.