Greece

Greece, located in the southern part of the Balkans and overlooking the Mediterranean Sea, has a surface area of approximately 131,957 km². It borders Albania, North Macedonia, and Bulgaria to the north, while to the east, it shares a border with Turkey. Its numerous islands, including Crete, Rhodes, and the Cyclades, play a crucial role in the country’s geography. The capital, Athens, has about 664,046 inhabitants, while its metropolitan area reaches 3.2 million, representing 30% of Greece’s total population, which stands at approximately 10.4 million people, according to 2023 estimates.

Economic Situation

In 2023, Greece’s Gross Domestic Product (GDP) reached €227.4 billion, with an estimated growth of +2.4% compared to the previous year. The per capita GDP stands at around €21,900, showing an improvement compared to the early years of the 2010 financial crisis. Greek exports, driven mainly by the shipping and chemical sectors, reached €47.6 billion, while imports amounted to approximately €63.1 billion, generating a trade deficit of €15.5 billion.

Exports grew by 7%, while imports increased by 5%. By the end of 2023, the inflation rate stood at +4.7%, driven by energy costs and rising food prices. The unemployment rate was around 10.8%, with youth unemployment still high at 27%. However, Greece has seen a decline in unemployment rates compared to the peaks of the economic crisis. Public debt remains high at 175% of GDP, but Greece has benefited from a series of debt restructurings and support plans from the European Union.

Forecasts

For 2024, projections indicate economic growth of 2.6%, with a moderate reduction in inflation to 3.8%. The Greek government aims for a gradual reduction of public debt through stricter fiscal policies and increased tax revenues.

Country Risk

Greece’s country risk remains moderate to high, mainly due to its high public debt and vulnerability to external shocks. However, the political situation is relatively stable, and the country has shown resilience in addressing economic and social challenges in recent years.

Foreign Direct Investments

In recent years, Greece has attracted a series of foreign direct investments, particularly in the renewable energy, tourism, and maritime infrastructure sectors. Privatizations, such as those of the ports of Piraeus and Thessaloniki, have drawn interest from Chinese and European investors. In 2022, FDI reached approximately €5 billion, marking a 10% increase compared to the previous year.

Geopolitical Analysis

Role in the European Union

Greece, a member of the EU since 1981 and of the Eurozone since 2001, went through a difficult period during the sovereign debt crisis that began in 2010. After years of austerity imposed by the Troika (EU, ECB, and IMF), Greece managed to stabilize its economy, though the path to full recovery remains long. Its membership in the EU and the Eurozone is crucial for its economic and political stability, with European structural funds and financial aid continuing to support the country’s recovery. Furthermore, Greece plays a key role in European migration policies, being one of the main entry points for migrants crossing the Mediterranean. This places the country in a delicate position in managing relations with the EU, particularly concerning immigration and external border security.

Relations with Turkey and the Eastern Mediterranean

One of the most critical aspects of Greek geopolitics is its complex relationship with neighboring Turkey. Territorial disputes in the Aegean Sea, particularly over island sovereignty and exclusive economic zones (EEZs), are frequent sources of tension. The discovery of natural gas deposits in the Eastern Mediterranean has exacerbated friction between the two countries, also involving Cyprus as a key player in the region.

Greece, a NATO member, has maintained a delicate balance with Turkey, which is also part of the Atlantic Alliance. However, Greece has sought support from European partners such as France and Italy, as well as from Israel, to counter Turkish ambitions in the Eastern Mediterranean. Military and diplomatic cooperation among these countries has intensified in recent years.

Relations with China and Russia

In recent years, Greece has attracted significant Chinese investments, particularly through the “Belt and Road Initiative.” The port of Piraeus, one of the most important in the Mediterranean, was acquired by the Chinese company COSCO, turning Greece into a strategic hub for Chinese trade with Europe. This has created some friction with Western partners, who are concerned about Chinese influence in critical European infrastructure.

Regarding Russia, Greece has historically maintained good relations, particularly due to cultural and religious ties (both are Orthodox Christian countries). However, following Russia’s invasion of Ukraine in 2022, Athens has had to balance its historical friendship with Moscow and the need to align with EU and NATO policies, supporting sanctions against Russia.

Migration Challenges and Security

Since 2015, Greece has been at the forefront of managing migration crises. Its geographical position, at the crossroads between Europe and the Middle East, has made Greece one of the main destinations for migratory flows. Athens has received EU support, but limited resources and difficulties in managing refugee centers have sparked criticism both domestically and internationally.

On the security front, Greece has invested in modernizing its armed forces and strengthening regional cooperation, particularly in response to tensions with Turkey. Greece’s participation in NATO and its alliances with countries like France and the United States are central to its national security strategy.