COMMISSION STAFF WORKING DOCUMENT 2022 Country Report – Greece Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the 2022 National Reform Programme of Greece and delivering a Council opinion on the 2022 Stability Programme of Greece
Date: 2022-05-23
Institutions: European Commission, Secretariat-General
Subjects: Greece, economic policy, economic recovery, economic reform, energy policy, fiscal policy, investment, organisation of health care, stability pact, stability programme

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 23.5.2022  SWD(2022) 609 final  COMMISSION STAFF WORKING DOCUMENT 2022 Country Report – Greece Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the 2022 National Reform Programme of Greece and delivering a Council opinion on the 2022 Stability Programme of Greece {COM(2022) 609 final} - {SWD(2022) 640 final}  
 
 
 
 
ECONOMIC AND EMPLOYMENT SNAPSHOT 

The Greek economy has weathered 
the pandemic well but risks remain 

deep 

undertook 

structural 
Greece 
reforms  in  the  aftermath  of  the  global 
financial  crisis  of  2007–2008.  The  global 
financial  crisis  revealed  the  vulnerabilities  of 
the Greek growth model, which was essentially 
driven  by  a  boom  in  the  non-tradable  sector 
and  high  consumer  and  housing  spending, 
combined  with  high  wage  increases,  rapid 
credit  growth  and  large  government  deficits 
financed at low interest rates. These triggered 
a  sovereign  debt  and  liquidity  crisis,  during 
which  Greece  received  financial  assistance 
from the euro-area countries to support three 
financial  assistance  programmes  that  were 
complemented  with  fundamental  economic, 
governance  and  social  reforms.  Following  the 
completion  of  these  programmes,  Greece  is 
monitored under enhanced surveillance.   

When  the  pandemic  hit,  Greece’s  post-
programme  economic  adjustment  was 
still ongoing. Greece’s GDP per capita prior to 
the  pandemic  stood  at  63.3%  of  the  EU 
average (1),  down  by  almost  25  percentage 
points compared to its peak of 88.2% in 2007. 
Following  economic  recessions  in  2015  and 
2016,  Greece  achieved  modest  GDP  growth, 
peaking in 2019. Over the same period, Greece 
recorded  significant  gains  in  export  market 
shares. Unemployment decreased from a peak 
of  27.8%  in  2013  to  17.9%  by  the  end  of 
2019.  During 
the  same  period,  Greece 
achieved  one  of  the  highest  fiscal  primary 
surpluses  (i.e.  government  surpluses  net  of 
interest payments) in the euro area.  

Despite  the  significant  improvements  of 
the  last  decade,  Greece  entered  the 

pandemic  facing  major  challenges.  These 
challenges were reflected in high public debt, a 
deeply  negative  net  international  investment 
position, a high share of non-performing loans 
on  banks’  balance  sheets  and  a  high 
rate.  Labour  productivity 
unemployment 
strengthened 
low, 
reflecting the long period of under-investment, 
as well as skills mismatches.  

in  2019  yet  remained 

Greece’s  investment  gap  vis-à-vis  its  EU 
peers  remains  large.  Investment  averaged 
24.1% of GDP between 2000 and 2007, above 
the  EU  average  of  22.2%. (2)  However,  by 
2021,  it  had  fell  to  only  12.8%  of  GDP,  the 
lowest  in  the  EU  and  around  10  percentage 
points below the EU average (Graph 1.1). This 
decline  reflected  both  cyclical  and  structural 
factors  and  was  largely  due  to  the  notable 
decrease  in  private  investment,  which  was  in 
turn hindered by access to finance constraints, 
inefficiencies  in  the  public  administration  and 
the justice system, and regulatory bottlenecks. 

Graph 1.1: Total investment (% GDP) 

Source: Eurostat 

The  Greek  economy  was  hit  harder  than 
the  rest  of  the  EU  during  the  pandemic, 
but  its  recovery  gained  traction  in  2021. 
Greece’s  GDP  contracted  by  9.0%  in  2020 
compared to an average of 5.9% in the EU, but 
recorded  a  strong  rebound  of  8.3%  in  2021 

(1)  According to latest available data for the pre-pandemic 

year of 2019. 

(2)  Annual chain-linked volume measure, source: Eurostat. 

2 

 
                                                 
     
                                                 
 
compared to 5.3% in the EU. Although tourism 
had  not  fully  recovered,  economic  activity 
reached its pre-pandemic level already by Q3-
2021.  Exports  of  goods  regained  momentum 
during  the  same  year  and  the  positive  labour 
market  developments  prior  to  the  pandemic 
resumed, partly thanks to the short-time work 
schemes that helped prevent large lay-offs. 

Greece  reacted  swiftly  to  the  pandemic, 
introducing  a  range  of  public  support 
measures.  Since  the  onset  of  the  pandemic, 
Greece has mounted a strong and rapid policy 
response, including with support from the EU’s 
SURE  instrument  (3),  to  sustain  the  economy 
and  support  the  recovery  (see  Annex  3:).  The 
measures it  introduced  to  support  households 
and  affected  businesses  are  expected  to  be 
largely phased out in 2022. The cost of these 
measures  along  with  the  fiscal  impact  of  the 
economic  downturn  caused  public  debt  to 
reach  206%  of  GDP  in  2020  before  declining 
to  193%  in  2021.  The  general  government 
balance  improved  in  2021,  reaching  -7.4%  of 
GDP  from  -10.2%  of  GDP  in  2020.  The 
authorities are planning to return to a position 
of a primary surplus again in 2023.  

While  the  labour  market  has  weathered 
the  crisis  relatively  well,  unemployment 
remains  high.  The  unemployment 
rate 
continued  its  decline  to  reach  13.0%  in  the 
fourth  quarter  of  2021,  while  for  the  same 
quarter,  the  employment  rate  (people  aged 
20-64  years)  reached  65%.  Nevertheless, 
young  people  were  severely  affected  by  the 
pandemic,  with  youth  unemployment  climbing 
to 38.6% in Q3-2020, before falling to 31.3% 
in  Q4-2021.  Wage  growth  turned  positive  in 
2021 and the minimum wage increased by 2% 
in  January  2022  and  by  an  additional  7.5% 
in May 2022. Job creation is set to continue as 
the  economy  expands  and  the  EU-supported 
recovery and resiliency plan is rolled out. 

Greece has made notable progress on the 
European  Pillar  of  Social  Rights,  but 

(3)   European instrument for temporary Support to mitigate 
Unemployment Risks in an Emergency, for details see 
https://ec.europa.eu/info/business-economy-
euro/economic-and-fiscal-policy-coordination/financial-
assistance-eu/funding-mechanisms-and-
facilities/sure_en. 

challenges  remain.  Greece  records  a  very 
high  share  of  young  people  that  are  not  in 
employment, education or training and one of 
the largest gender employment gaps in the EU 
with  third  country  nationals  scoring  worse  on 
both  fronts.  Moreover,  there  are  persisting 
gaps  in  access  to  social  protection  for  non-
standard  forms  of  employment,  particularly 
for  the  self-employed,  while  the  share  of 
population  and  especially  children  at  risk  of 
poverty  or  social  exclusion  continues  to  be 
relatively high (see Annex 12).  

Regional  disparities  remain  significant. 
With  more  than  half  of  its  population  and  a 
little  less  than  two  thirds  of  its  economy 
concentrated  in  the  regions  of  Attica  and 
Central  Macedonia,  Greece  features  a  rather 
heterogeneous  economic  development  model 
across its various regions. The large disparities 
in  GDP per  capita  are  notably  due to  regional 
inequalities 
labour 
in 
investment  and 
market  conditions,  and 
(see  Annex  15). 
competitiveness 
Education  outcomes  also 
to  vary 
significantly across regions (see Annex 13).  

labour  productivity, 

levels 

tend 

industry 

Tourism  is  a  key  source  of  revenues.  The 
direct  contribution  of  tourism  to  the  country's 
economic  output  is  estimated  at  7.7%  of  the 
total  gross value  added in  2019,  which  is  the 
highest  among  Member  States  with  a  large 
share  of  tourism (4).  The  sector  is  the  largest 
export 
country,  with 
international  tourist  receipts  accounting  for 
around  a  quarter  of  the  country’s  export 
revenue. The restrictions that were put in place 
during  the  pandemic  have  disrupted  the 
operation  of  the  sector,  with  tourist  arrivals 
falling  by  76.5%  in  2020  compared  to  2019. 
However,  tourism  partially  recovered  in  2021 
and is expected to recover fully by 2023.  

the 

in 

With  support  from  EU  funds,  the  country 
is  gradually  moving  towards  a  more 
sustainable  development  model.  Progress 
the  United  Nations’ 
towards  meeting 
Sustainable Development Goals (UN SDGs) has 
been  mixed.  Albeit  starting  from  a  relatively 
low position, Greece has taken important steps 

(4)  The respective figure for Cyprus is 7.1%, while for 

Spain, Croatia and Portugal it is 6.4%, 6.3% and 6.1% 
respectively. 

3 

 
                                                 
                                                 
is  now  at 

to  meet  environmental  sustainability  goals 
and  its  performance  in  reducing  greenhouse 
gas  emissions  and  using  renewable  energy 
sources 
the  EU  average. 
Nonetheless,  challenges  remain  in  waste  and 
water management and the circular economy. 
Greece  also  fares  better  than  in  the  past  in 
several  dimensions  of  fairness,  productivity 
and macroeconomic stability, although there is 
room  for  further  improvement  (see  Annex  1). 
EU funds such as the Recovery and Resilience 
Facility (RRF) and the EU cohesion policy funds 
provide  key  support  to  Greece’s  efforts  to 
meet its SDGs (see Annex 3).  

expected  to  peak  in  the  second  quarter  of 
2022  and  remain  high  thereafter,  before 
easing in 2023. According to the Commission’s 
2022  spring  forecast,  inflation  is  expected  to 
increase by 6.3% in 2022 and drop to 1.9% in 
2023,  driven  by  energy  price  developments 
and  their  pass-through  to  other  commodity 
prices, notably food. The hike in energy prices 
affects  low-income  households  the  most  and 
add  to  the  existing  challenges,  illustrated  by 
the  fact  that  17.1%  of  the  Greek  population 
were  unable  to  keep  their  homes  adequately 
warm  in  2020,  around  8.2  percentage  points 
above the EU average.  

Russia’s war of aggression against  
Ukraine impacts on the Greek 
economy 

total 

tourist 

Greece  has  relatively  limited  trade  links 
with  Russia  and  Ukraine (5).  Tourist  
receipts from Russia represent around 2.5% of 
receipts  of  Greece (6). 
the 
Nevertheless,  dependence  on  industrial  and 
energy  imports  from  Russia  is  more  evident, 
notably  for  natural  gas  and  oil  (though 
significantly declining in recent years) and, to a 
lesser  extent,  base  metals  and  agricultural 
products.  According  to  the  latest  data,  final 
demand  in  Greece  contains  around  1.1%  of 
in  Russia (7),  with 
added  value  produced 
energy-intensive 
as 
such 
manufacturing  and  oil  refineries,  as  well  as 
agriculture, depending on imports from Russia.  

sectors 

The  increase  in  international    energy 
prices  places  a  heavy  burden  on 
households  and  businesses.  Electricity 
prices  in  Greece  increased  by  44%  between 
June and December 2021 and are expected to 
remain elevated in 2022. Consumer prices are 

(5)  In 2021, Greek commodity exports to Russia amounted 
to around 0.1% GDP, while exports to Ukraine were 
marginally higher, at around 0.2% GDP. 

(6)  Based on 2019 data. Source: Greek Tourism 

Confederation. 

(7)  Expressed as a share of Greece’s gross domestic 

on 

Based 

output 

growth. 

The  steadily  rising  input  prices  and  the 
supply  shortages  in  an  array  of  goods, 
are  taking  a  toll  on  Greece’s  production, 
with the latest data showing a slowdown 
the 
in 
Commissions’  2022  spring  forecast,  real  GDP 
growth in 2022 is expected to ease but remain 
solid,  despite  the  adverse  impact  of  the 
military  aggression  in  Ukraine.  For  2023,  the 
gradual  easing  of  the  inflationary  pressures 
later during the year, is set to support private 
consumption  and  increase  its  contribution  to 
is 
growth.  Over  the  same  year,  tourism 
expected  to fully regain  the losses it suffered 
during  the  pandemic.  Overall,  real  GDP  is  set 
to grow by 3.5% in 2022 and 3.1% in 2023.  

Greece made significant progress 
with implementing key reforms 
under enhanced surveillance  

number 

implemented  a 

of 
Greece 
significant  reforms  in  recent  years  to 
bolster  its  growth  prospects.  Greece  took 
important  steps  to  ease  the  administrative 
burden  for  businesses,  simplify 
investment 
licensing,  reform  labour  legislation  and  expand 
the provision of digital public services. It has also 
developed  its  energy  markets,  although  market 
participation 
low.  These 
reforms helped improve cost competitiveness (8) 

relatively 

remains 

product. Source: JRC calculations, based on the Eurostat 
2019 FIGARO EU inter-country supply, use and input-
output tables. 

(8)  Cost competitiveness, as measured by unit labour cost, 

is computed as the nominal compensation per 
employee divided by real GDP per person employed. 

4 

 
                                                 
                                                 
the  Public  Gas  Corporation 

governance of state-owned enterprises. The 
country’s  privatisation  programme 
regained 
momentum in 2021, with the financial closure of 
the  Hellinikon  project,  the  selection  of  the 
preferred  investors  for  the  Egnatia  concession 
and 
(DEPA) 
Infrastructure,  among  others.  The  privatisation 
programme  helps  to  make  the  economy  more 
efficient and stimulates private investment, which 
will  greatly  benefit  the  economy  by  generating 
value  added  and  creating  jobs (10).  Corporate 
governance  of  state-owned  enterprises  in  the 
portfolio of the Hellenic Corporation of Assets and 
Participations has also significantly improved over 
the last few years, thanks to the adoption of best 
practices. In  addition, the  authorities  are  working 
legal 
the 
improving  and  modernising 
on 
framework for all state-owned enterprises. 

Greece  has  continued  to  take  steps  to 
modernise  its  public  administration  and 
justice system. The low efficiency of the public 
sector  has  for  long  been  a  major  barrier  to 
growth. Greece has put in place modern human 
resources  management  practices  in  the  public 
administration,  including  annual  performance 
appraisals  and  a  mobility  scheme,  and 
is 
planning to introduce goal setting as part of the 
appraisal exercise. As regards the justice system, 
the  creation  of  special  court  chambers  for  a 
speedier resolution of economic disputes and the 
revision of the insolvency code and the code of 
civil  procedure  are  expected 
improve 
efficiency  of  courts,  which  remains  particularly 
low (11). Greece has also introduced new IT tools 
to speed up several types of courts proceedings 
(see Annex 11).  

to 

before  the  pandemic.  Nevertheless,  despite 
notable  progress  in  recent  years,  the  country’s 
export base largely remains focused on products 
with  a  low  level  of  technological  sophistication 
and  the  exports-to-GDP  ratio  remains  relatively 
low,  despite  almost  doubling  over  the  past 
decade.  Regarding  public  finances,  progress  in 
clearing  outstanding  obligations  to  the  private 
sector  has  been  significant  and,  going  forward, 
the  implementation  of  public  investments  is 
expected  to  be  supported  by  a  major  public 
procurement  reform  (see  Annexes  10,  11),  the 
the 
new  Project  Preparation  Facility,  and 
Strategic  Projects  Pipeline  put  in  place  in  2021.  
The  stimulus  from  the  Recovery  and  Resilience 
Facility  and  other  EU  funds  are  expected  to 
further  strengthen  Greece’s  growth  prospects 
and  help  close  its  large  investment  gap  going 
forward.  

(Hercules) 

The  banking  sector  has  become  more 
stable  and  resilient,  but  vulnerabilities 
persist. In recent years, the authorities adopted 
significant financial sector reforms, including an 
overhaul  of  the  insolvency  framework  and  an 
asset  protection 
that 
scheme 
contributed to a strong reduction in the ratio of 
non-performing loans (9) from its peak of 47.4% 
in September 2016 to 12% in September 2021. 
Nevertheless, it still remains among the highest 
in  the  EU.  Banks’  core  profitability  remains  low, 
but is  expected to increase with the  rebound in 
economic activity and the reduction in provisions 
set aside for potential losses. Banks’ total capital 
ratio stands at 15% compared to an EU average 
of  19.3%,  while  capital  quality  remains  weak. 
The pandemic interrupted the declining trend of 
private debt, measured as a share of GDP, while 
the  cost  of  borrowing  continues  to  be  high, 
particularly for households and small businesses, 
and  an  underdeveloped  capital  market  limits 
firms’  access  to  non-bank  financing  (see  Annex 
16).  

Greece  has  progressed  well  with 
its 
privatisation agenda and with improving the 

(9)  The ratio refers to non-performing loans as a share of 

total gross loans and advances on a consolidated basis, 
as reported by the European Central Bank. This figure is 
different to the one reported under enhanced 
surveillance, which corresponds to non-performing loans 
as a share of total gross customer loans on a solo 
basis, as reported by the Bank of Greece. 

(10)  Macroeconomic and socioeconomic impact of the 

privatisation programme of the Hellenic Republic, July 
2020, Foundation for Economic and Industrial Research, 
Executive Summary, p. 3. 

(11)  EU Justice Scoreboard 2021: 

https://ec.europa.eu/commission/presscorner/detail/en/ip
_21_3523, see in particular Figure 7, p. 9. 

5 

 
                                                 
                                                 
THE RECOVERY AND RESILIENCE PLAN IS UNDERWAY 
THE RECOVERY AND RESILIENCE PLAN IS UNDERWAY 

At  16.7%  of  national  GDP  in  2021,  the 
Greek  recovery  and  resilience  plan  (RRP) 
is  one  of  the  largest  in  the  EU.  Supported 
by  the  EU’s  Recovery  and  Resilience  Facility 
(RRF), the plan amounts to EUR 30.5 billion (in 
2018  values)  for  2021-2026,  EUR 17.77 
billion  in  grants  and  EUR 12.73  billion  in 
loans (see  Annex  2).  This comes  on  top  of  EU 
cohesion  policy  support,  which  amounts  to 
EUR 21.3  billion  (12.8%  of  GDP)  for  2021-
2027. 
In  the  design  phase  of  the  RRP, 
particular  attention  was  paid  to  ensuring  that 
the  two  EU  financing  resources  reinforce  one 
another  and  that  any  overlaps  are  avoided. 
With  its  174  measures  consisting  of  106 
investments and 68 reforms, the Greek RRP is 
expected  to  have  a  significant  impact  on 
economic growth in Greece, increasing GDP by 
2.1-3.3% by 2026 (12).  

under 

The  close  link  between  the  RRP  and  the 
Council’s 
country-specific 
recommendations  to  Greece  ensures  that 
projects address longstanding challenges. 
Building on the reform agenda initiated under 
the  financial  assistance  programmes  and 
currently  monitored 
enhanced 
surveillance,  the  RRP  covers  many  areas  that 
have  been  identified  as  challenges  in  the 
European  Semester  cycle  and  outlined  in  the 
Council’s  country-specific 
recommendations 
(CSRs)  to  Greece  (see  Annex  4).  In  particular, 
the  RRP  includes  measures  to  improve  public 
financial  management, 
the 
resilience  and  accessibility  of  the  healthcare 
system, improve the functioning of the labour 
and  product  markets,  and  support  public  and 
private  investment  in  line  with  the  CSRs 
addressed to Greece during the last 3 years.  

strengthen 

(12)  According to latest simulations conducted by the 

Commission, GDP is expected to increase by 2.1-3.3% 
by 2026 from the combined effect of the grant and 
loan component. These simulations do not include the 
possible positive impact from the structural reforms 
envisaged under the plan, which can be substantial. 

6 

the 

The  recovery and resilience  plan  is a key 
policy  anchor  for  the  medium  term.  Upon 
conclusion  of 
financial  assistance 
programme  and  as  part  of  the  launch  of 
enhanced surveillance, Greece made a number 
of commitments to Eurogroup partners in June 
2018,  which  covered  the  period  up  to  mid-
2022.  The  authorities  have  focused  their 
efforts 
outstanding 
commitments. With projects aiming to improve 
productivity,  create 
incentives  for  private 
investment, and support significant reforms in 
the  labour  market  and  the  judicial  and  tax 
systems, the RRP builds upon and significantly 
implemented  under 
broadens  the  reforms 
enhanced  surveillance. 
to 
is  expected 
It 
modernise the structure of the economy, while 
making it more resilient. 

delivering 

on 

on 

and 

investments. 

The  plan  is  heavily  oriented  towards 
the  green  and  digital 
accelerating 
transitions,  including  through  significant 
reforms.  The  Greek  energy  sector 
is 
traditionally  reliant  on  fossil  fuels.  EUR 11.4 
billion  (37.5%  of  Greece’s  RRF  allocation) 
under the Greek plan are dedicated to climate 
objectives,  financing  a  total  of  35  different 
reforms 
This  will 
nevertheless  not  be  sufficient  to  meet  the 
country’s  2030  and  2050  climate  objectives, 
while ensuring a fair transition. Greece notably 
plans  to  increase  the  share  of  renewable 
energy  sources in  its  energy  mix,  including  by 
accelerating the launch of offshore wind parks, 
but further efforts will be necessary, including 
to  improve  the  energy  efficiency  of  buildings, 
promote  sustainable  transport  and  improve 
water and waste management. In the area of 
digitalisation,  Greece 
considerable 
challenges. These are reflected in shortfalls in 
connectivity,  lacking  digital  skills  at  all  levels, 
the  slow  uptake  of  digital  technologies  in  the 
private  and  public  sector  and  in  particular  by 
small  and  medium-sized  enterprises  (SMEs), 
and low digitalisation of public services. EUR 7 
billion  (23.3%  of  Greece’s  RRF  allocation)  will 

faces 

 
 
                                                 
 
the 
digital 

support digital infrastructure development, the 
state  and  public 
digitalisation  of 
administration, 
the 
digitalisation  of  businesses,  with  a  focus  on 
SMEs. Both the green and digital transition will 
also be supported through the loans extended 
under  the  plan  which  aim  to  boost  private 
investments in the two areas.  

skills 

and 

To  foster  the  green  transition,  the  plan 
sets out measures to promote renewable 
energy,  sustainable  transport,  energy-
efficient  buildings,  and  waste  and  water 
management. 
in  electricity 
Investments 
infrastructure aim to increase the potential for 
renewable  energy  sources  and  storage 
capacity, while renovations of buildings aim to 
increase  their  energy  efficiency.  To  make 
mobility  more  sustainable,  the  Greek  plan 
invests  in  the  installation  of  8  000  charging 
stations  for  electric  vehicles  and  supports 
major reforms in rail and road transport. In the 
area  of  climate  change  adaptation,  the  plan 
reforestation, 
includes  measures 
biodiversity,  improving irrigation networks and 
wastewater  management.  The  plan  will  also 
strengthen  civil  protection  and  disaster 
management mechanisms. 

for 

The plan will help the economy adapt to a 
new  digital  way  of  working,  including  by 
developing key digital skills. Projects under 
the  plan  include  a  widespread  deployment  of 
very  high  capacity  networks  such  as  fibre 
connections  and  5G,  and  a  thorough  digital 
transformation  of  the  public  administration. 
The  plan  notably  aims  at  streamlining  and 
digitalising administrative processes, providing 
new  IT  equipment  and  training  for  public 
also 
administration 
features in many other areas of the plan, such 
as  education,  lifelong  learning,  justice  and 
taxation.  In  addition,  the  plan  supports  the 
digitalisation of SMEs. 

staff.  Digitalisation 

effective 

The  RRP  proposes  concrete  actions  to 
labour  market 
promote 
integration,  employment  and  upskilling, 
while  modernising  the  education  and 
healthcare  systems,  thereby  contributing 
to  implementation of  the  European  Pillar 
of  Social  Rights.  To  reduce  unemployment 
and  increase  the  labour  force,  Greece  has 

forward, 

revised its Labour law and reformed the public 
employment  service.  Going 
the 
reform  of 
insurance 
the  unemployment 
framework and the large-scale investments in 
upskilling  programmes  and  hiring  subsidies 
will  help  promote  the  re-entry  of  people  into 
the 
the 
labour  market.  Moreover, 
modernisation of the vocational education and 
training  system  and  the  reform  of  the  adult 
learning 
skills 
mismatches.  To  increase  participation  in  early 
childhood  education  and  care,  the  plan  will 
the  creation  of  new  childcare 
subsidise 
facilities 
large 
in  municipalities  and 
companies. In healthcare, to improve resilience 
of  the  national  system,  the  plan  invests  in 
health  prevention,  upgrading  of  the  primary 
care  network  and 
renovation  of  public 
hospitals. 

system 

reduce 

should 

in 

Modernising  the  economy  and  helping 
businesses  grow  and  export  is  a  key 
focus  of  the  plan.  The  large  share  of  micro 
and  small  enterprises  in  the  Greek  economy 
and  the  still  complex  business  environment 
weigh  on  productivity  growth  and  adversely 
affect  export  performance.  Modernising  the 
the 
regulatory 
administrative  burden  on  businesses  and 
supporting 
and 
development activities are among the goals of 
the  plan.  The  plan  also  supports  companies 
including  SMEs  to  develop  partnerships  and 
helps  them  grow,  export  and  become  more 
productive.  

companies’ 

framework 

research 

reduce 

to 

The  plan  aims  to  modernise  the  judicial 
system. The performance of the Greek justice 
system is among the lowest in the EU, with an 
estimated  time  needed  to  resolve  civil  and 
commercial  cases  exceeding  600  days  in 
2020. The plan aims to address structural and 
operational  inefficiencies,  broaden  the  use  of 
IT tools in courts and improve the digital skills 
of judges and clerical staff. Moreover, the plan 
supports  the  revision  of  the  judicial  map  that 
should  rationalise  the  regional  distribution  of 
infrastructure, 
human 
equipment 
resources.  It  also  finances  the  construction  or 
renovation  of  courthouses.  Judicial  police  will 
be  created  to  serve  the  specific  needs  of  the 
legal  procedures  will  be 
justice  system, 

and 

7 

 
objectives.  The  responsibility  for  the  timely 
implementation of the plan lies with the Greek 
authorities,  who  have  committed  to  331 
performance-based  milestones  and  targets 
linked  to  the  various  reform  and  investment 
measures. There are strong links and synergies 
between  these  measures  and,  given  their 
broad  scope,  involvement  of  social  partners 
will  be  key  to  ensuring  full  and  timely 
implementation of the plan (see Annex 2).  

simplified and accelerated, and IT coverage of 
legal proceedings will be expanded.  

through 

to  finance 

By  leveraging  private  investment,  loans 
extended  under  the  RRP  should  help  the 
economy grow and become more resilient, 
and help close the investment gap, which 
is  estimated  at  around  10%  of  GDP  in 
2021. EUR 12.7 billion will be disbursed in the 
form  of  loans  and  will  support  companies’ 
access 
loans,  equity 
support  for  SMEs  and  InvestEU.  In  addition  to 
providing  funds,  the  plan  focuses  on  reducing 
the  administrative  burden  and  improving  the 
regulatory framework for companies, including 
through  justice  and  taxation  system  reforms. 
The  financial  sector  and  capital  markets  will 
be  strengthened  through  upgrades  to  the 
digital  infrastructure  to  support  the  recently 
adopted  insolvency  framework.  Reforms  to 
address  private  indebtedness  challenges  and 
information  asymmetries  between  public 
entities,  financial  institutions,  households  and 
businesses  are  also  envisaged.  Moreover,  the 
modernisation  of 
capital  market’s 
the 
regulatory framework and the digitalisation of 
its  supervisory  authority  are  expected  to 
support the provision of alternative sources of 
financing. 

Box 1: 

Key deliverables under the recovery and resilience plan in 2022-23 

  Launch of rounds 2 and 3 of the energy renovation of residential buildings.  

  Entry into force of a revised legislative framework for public urban and  regional  passenger 

transportation services.  

  Launch of project to promote the digitalisation of SMEs. This project will finance investments 

in digital technologies and services for 100 000 SMEs.  

  Reform of the national lifelong learning framework.  

  A  new  legal  framework  to  clarify  responsibilities  across  all  public  administration  levels and 

address overlaps.  

  Entry into force of legislation to encourage business internationalisation by creating a system 
of incentives and support for micro and small enterprises to help them grow and make use of 
economies of scale.  

  Entry into force of legislation for the launch of a performance-pay system for civil servants.  

  Start of construction works for the E-65 Central Greece Highway: Trikala-Egnatia.  

Full  and  timely  implementation  of  the 
plan  will  be  key  to  achieve  its  ambitious 

8 

 
 
FURTHER PRIORITIES AHEAD 
FURTHER PRIORITIES AHEAD 

include 

Beyond the challenges fully addressed by 
faces  additional 
the  RRP,  Greece 
challenges.  The 
further 
latter 
streamlining  the  tax  system  and  modernising 
the public administration and health system to 
promote investment and social inclusion, while 
supporting fiscal sustainability. Completing key 
reforms  of  the  business  environment  such  as 
the  national  cadastre  can  further  promote 
investment.  Further  streamlining  the  public 
employment  service  could  enable  more 
systematic support to jobseekers. There is also 
scope  to  move  to  a  more  resource-efficient 
economy  by  phasing  out 
lignite-based 
electricity  production,  promoting  the  take-up 
of  renewables  and  further  developing  the 
electricity market. Addressing these challenges 
will also help Greece make further progress in 
achieving  the  UN  SDGs  on  environmental 
sustainability, 
productivity  and 
fairness, 
macroeconomic stability.  

Moving towards more sustainable 
public finances  

Returning to a primary fiscal surplus and 
decreasing  public  debt  while  keeping  the 
economic  recovery  on  track  is  key  to 
ensuring sustainability of public finances. 
The cost of the covid-19-related public support 
measures  increased  the  debt-to-GDP  ratio  by 
over  10  percentage  points,  to  193%  in  2021 
in  2019.  Nevertheless, 
up  from  180.7% 
borrowing  costs  remained  broadly  stable  for 
most of this period. While the bulk of Greece’s 
public debt is held by its European partners at 
long  maturities  and  concessional  rates,  the 
interest  rate  it  pays  on  new  market  debt  will 
be increasingly relevant for debt sustainability. 
In  the  long  run,  the  sustainability  of  Greece’s 
public debt will also hinge crucially on progress 
with  the  fiscal  adjustment  and  with  achieving 
robust growth rates (Annex 20). 

The  structure  of  public  finances  has 
improved  over  time.  Total  revenues  from 
taxes  and  social  security  contributions  (as  a 
share of GDP) have increased since the global 
financial  crisis  and  are  currently  close  to  the 
EU average. Since 2020, important steps have 
also been taken to improve the composition of 
tax  revenues  by  reducing  corporate  and 
personal  tax  and  social  security  contribution 
rates  and  by  improving  tax  collection,  but 
challenges  remain.  On  the  expenditure  side, 
Greece made considerable efforts prior to the 
its  current  primary 
pandemic 
expenditure  close  to  or  even  below  the  euro-
area  average  as  a  share  of  GDP.  The  public 
sector  wage  bill  decreased  and  reforms  of 
spending 
social  expenditure 
efficiency.  Despite  these  efforts,  expenditure 
on  public  wages  and  pensions  as  a  share  of 
GDP is still above the euro-area average.  

to  keep 

improved 

has 

substantially 

Greece 
reduced 
corporate  taxes,  but  investment  barriers 
remain.  The  corporate  income  tax  rate  stood 
at 22% in 2021, down from 28% in 2019. For 
individual  entrepreneurs,  Greece  applies  an 
annual  lump-sum  tax  of  EUR  650,  regardless 
of whether they generate profits or not and on 
top  of  the  personal  income  tax  and  other 
taxes.  This  results  in  very  high  effective  tax 
rates for low-turnover enterprises (13) and acts 
as a barrier to market entry. Moreover, this tax 
creates  unnecessary  difficulties  for  salaried 
professionals,  including  university  academics, 
in starting up their own businesses (see Annex 
18),  and in improving  the weak  links  between 
academia  and  the  productive  sector  (see 
Annex 9). Although it has declined significantly 
from 29% in 2018 to 25.8% in 2019, Greece’s 

(13)  Dianeosis (2016), ‘Tax evasion in Greece’, 

https://www.dianeosis.org/en/2016/06/tax-evasion-in-
greece/ 

9 

 
 
 
                                                 
 
value added tax (VAT) gap (14) remains among 
the highest in the EU. 

its 

the  complexity  of 

Companies,  and 
in  particular  foreign 
investors,  struggle  with  the  complex  tax 
framework.  Greece  ranks  29th  of  38  OECD 
countries  on 
tax 
system (15)  which  acts  as  a  disincentive  for 
foreign  direct  investments.  Greece  lacks  a 
comprehensive  advance  tax  ruling  system, 
used  in  other  Member  States  as  a  tool  to 
provide  a  binding  legal  interpretation  on  the 
application  of  tax  law  in  a  specific  situation. 
tax 
Such 
promote 
compliance, 
foreign 
investors (16). 

particularly 

voluntary 

systems 

among 

to 

increase  compliance  with 

Public  revenue  administration  has  been 
strengthened  in  recent  years,  but  tax 
remains  a  challenge.  The 
collection 
collection  of  overdue  tax  debt  remains  a 
challenge  in  Greece,  with  the  total  amount  of 
unpaid  tax  debt  corresponding  to  212.3%  of 
the  total  net  revenue  in  2019.  Despite  past 
efforts 
tax 
obligations,  new  ad  hoc  repayment  schemes 
for  debts  owed  by  private  individuals  to  the 
tax  administration  continued  to  be  created 
before  the  pandemic (17),  undermining  the 
credibility  of  such  efforts.  Through  these 
schemes,  the  tax  administration  provided  a 
broad  range  of  debtors  the  opportunity  to 
delay the repayment of their tax liabilities over 
tax  settlement 
and  above 
scheme, 
the  payment 
discipline  for  both  individuals  and  businesses. 
However,  there  has  been  some  progress  in 
modernising 
by 
promoting  the  use  of  electronic  payment 
transactions  with  the  introduction  of  specific 

the  standard 
thus  hampering 

collection,  mainly 

tax 

(14)  The gap is the difference between the amount of VAT 
collected and expected. The indicator provides an 
indicator of the effectiveness of VAT enforcement and 
compliance and an estimate of tax revenue losses. 

(15)  Tax Complexity Index (2021), ‘Tax Complexity Index for 

Greece’, https://www.taxcomplexity.org/ 

(16)  Givati, Y., ‘Resolving legal uncertainty: the unfulfilled 
promise of advance tax rulings’, Discussion Paper No. 
30, Cambridge (MA), Harvard Law School, June 2009. 

(17)  Fifth Enhanced surveillance report, European 

Commission, February 2020. 

incentives  and  thresholds (18),  while  a  digital 
platform  (myData)  has  allowed  businesses  to 
submit  their  financial  accounts  and  invoices 
digitally  to  the  tax  administration.  Another 
positive  step  aiming  to  strengthen  the  tax 
administration’s  capacity  to  attract  and  retain 
highly qualified staff was the completion of a 
key public administration reform in 2021. The 
reform    links  part  of  the  salary  with  the  job 
description  and  the  required  qualifications  for 
the specific post. This is particularly important 
for  the  success  of  the  ongoing  digitalisation 
efforts  in  tax  administration.  The  aim  is  to 
offer  a  wide  range  of  remote  services, 
including 
reduce 
compliance  cost  for  taxpayers.  The  RRP  will 
help  digitalise  tax  audits  and  controls  that, 
combined with the planned acceleration of VAT 
refunds, should improve tax collection.  

facilities, 

e-filing 

to 

is 

consultation 

improving  over  time,  public 
Despite 
administration  performance  remains low. 
Public 
used  more 
systematically  and  there  has  been  a  marked 
last-minute 
the  number  of 
reduction 
in 
amendments 
parliament. 
to 
introduced 
However, there is scope to improve the quality 
of  impact  assessments  of  draft  laws  and  to 
limit  the  cases  of  legal  provisions  introduced 
outside  the  normal  legislative  process  that 
remain  high  and  may  risk  undermining  recent 
good  law-making  efforts  (see  Annex  11). 
Greece has expanded digital public services for 
businesses  and  the  general  public,  but  the 
challenge  is  to  streamline  and  simplify  the 
underlying  processes.  The  national  integrity 
system spearheaded by the Ministry of Interior 
and  the  National  Transparency  Authority  is 
rolling  out  an  internal  control  system  across 
foster 
administration 
the 
accountability.  The  focus  now  turns  to  the 
implementation  of  various  integrity  system 
initiatives,  such  as  putting  in  place  integrity 
advisors  to  provide  information  and  expertise 
on the planned rules and processes.  

public 

to 

The  public  sector  wage  bill  remains 
comparatively  high.  Although  the  size  of 
Greece’s public sector has been reduced since 
2010,  the  wage  bill  remains  above  the  EU 

(18)  For example, the obligation to cover at least 30% of the 
annual personal income with electronic payment of 
purchases for goods and services. 

10 

 
                                                 
                                                 
average  (Graph  3.1).  Since  2018,  there  has 
been  a  steep  increase  in  temporary  staff  (by 
nearly  25%),  while  the  number  of  permanent 
staff has been kept broadly stable, in line with 
the one-in-one-out hiring rule. Considering the 
ageing  of  its  civil  servants,  with  half  of  the 
permanent  staff  aged  over  50,  Greece  will 
face  a  challenge,  but  also  an  opportunity,  to 
replace the many civil servants that will retire 
in  the  coming  years.  The  multiannual  hiring 
plan  along  with  the  digital  organisational 
charts  and  job  descriptions,  will  help  prioritise 
the  various  needs  and  ensure  that  new  staff 
have the desired skills. 

Graph 3.1: Size of Greek public sector (number 
of employees) 

Source: Greek authorities and Eurostat 

the 

sector 

selection 

and 
in  hiring.  With 

The  high  number  of  temporary  staff  is  a 
challenge  for  controlling  the  size  of  the 
maintaining 
public 
transparency 
technical 
support  from  the  European  Commission,  in 
2021, Greece adopted  a reform to strengthen 
the  Personnel  Selection  Council  (ASEP)  and 
modernise 
for 
permanent staff through the introduction of a 
mandatory  written  test.  The  high  number  of 
temporary  staff  may  lead  to  the  expectation 
that  these  posts  will  be  converted 
into 
permanent posts, as this was common practice 
previously.  However,  as  the  selection  process 
for temporary posts is not as thorough as for 
permanent posts, it could weaken the integrity 
of  the  new  selection  process  for  permanent 
staff.  

process 

The  healthcare  system  is  still  hospital-
centric,  with  curative  care  spending 
focused  on  hospitalisations.  Greece  ranks 
in the bottom half of Member States on public 
spending  on  curative  care  (2.9%  of  GDP  in 

11 

2019  vs  the  EU  average  of  3.7%).  Of  this, 
spending  on  hospitalisations  is  among  the 
highest  in  the  EU,  as  opposed  to  ambulatory 
care,  which  is  among  the  lowest (19).  Public 
spending  on  pharmaceuticals  is  also  among 
the highest in the EU, and is almost twice the 
EU  average (20),  although  planned  measures 
such as the expansion of compulsory protocols 
and  of  centralised  procurement,  are  expected 
to reduce it.  

The  ongoing  reform  of  primary  health 
care  can  potentially  address  the  above 
weaknesses.  A  well-functioning  primary  care 
system  covering  the  whole  population  and 
with the family doctor playing a central role in 
shaping  the  care  pathway  through  referrals, 
i.e., gatekeeping, can increase the efficiency of 
access  to  healthcare  goods  and  services.  A 
reform  of  the  primary  health  care  system  is 
underway, it will be adopted in May 2022 and 
it is expected to be rolled out by the end of the 
year,  with  substantial  progress  expected  by 
October.  Its  implementation  will  be  supported 
by 
infrastructure  development 
measures,  but  the  success  of  the  reform  will 
depend  on  the  availability  of  an  adequate 
stock of public sector family doctors. 

the  RRP 

The  pandemic  deeply  challenged  the 
healthcare  system.  To  respond  to  the 
pandemic,  Greece  expanded  the  laboratory, 
intensive  care  and  disease  surveillance 
capacities of its healthcare system, as well as 
its  workforce.  The  system  benefited  from 
increased  public  support  which  continues  in 
2022  at  0.15%  of  GDP,  bringing  healthcare 
spending  closer  to  the  EU  average.  Improving 
spending  efficiency  will  be  key  to  making  the 
most  of  any  additional  resources  allocated  to 
healthcare and to sustainably enhance access 
(see Annex 14). Examples of measures that go 
in  that  direction  and  are  currently  missing 
include  a  stronger 
from  Greece’s  RRP 
enforcement  mechanism 
to  monitor  and 
sanction  the prescription  of  unnecessary  care, 
a  revision  of  incentives  across  the  broader 
pharmaceuticals  supply  chain,  and  systematic 
communication  campaigns  to  better  inform 
patients on available care options. 

(19)  Measured as a share of public current health spending. 

(20)  Based on Eurostat data. 

6%7%8%9%10%11%12%0150 000300 000450 000600 000750 000900 0002009201020112012201320142015201620172018201920202021Other staff (incl. elected officials)Temporary staffPermanent staffEL - public sector wage bill (% of GDP) *EU27 - public sector wage bill (% of GDP) * 
     
                                                 
Further easing doing business 

the  Greek 

tax  system 

remains  heavily 

The  business  environment  has  improved, 
regulated  and 
but 
complex.  Doing  business  in  Greece  is  easier 
today  than  a  decade  ago  thanks  to  the 
the 
expansion  of  digital  public  services, 
reduction in corporate taxes, the creation of a 
unified social security system, and the reform 
of  the  labour  and  product  markets.  Despite 
remains 
reforms, 
complex  and  sometimes  intransparent  due  to 
legal  judgements,  with  limited  coverage  of 
fully-updated 
tax  payers. 
Greece  also  has  one  of  the  slowest  court 
systems in Europe, while constraints in access 
to  finance  and  administrative  and  regulatory 
bottlenecks  prevent  the  full  integration  of 
companies,  especially  SMEs,  into  the  single 
market (see Annex 10). According to the OECD, 
Greece  has  one  of  the  more  restrictive  and 
heavily  regulated  business  environments (21), 
while, despite efforts to eliminate it, corruption 
in public administration is perceived to be still 
relatively high (22).  

information 

to 

One  particular  challenge  that  businesses 
face  is  the  lack  of  a  comprehensive 
national  cadastre.  The  development  of  a 
modern  cadastre  (i.e.  a  register  of  real  estate 
and land ownership) in Greece started in 1994 
and  has  been  an  emblematic  reform  of  the 
financial  assistance  programme.  Progress  so 
far  has  been  significant  and  the  full  cadastre 
is  expected 
to  be  completed  by  2023. 
Cadastral  mapping  covering  63.5%  of  real 
property rights has been completed or is in the 
validation  phase  and  more  than  half  of  the 
planned  cadastral  offices  and  branches  have 
been  set  up  replacing  the  old  mortgage 
offices.  The  implementation  of  the  cadastre 
has  been  supported  by  EU  Structural  Funds, 
the structural  reform support  programme and 
more  recently,  the  Recovery  and  Resilience 
Facility. 

(21)  Product Market Regulation indicators, 

https://www.oecd.org/ economy/ reform/indicators-of-
product-market-regulation/ 

(22)  Transparency International Corruption Perceptions Index, 

https://www.transparency.org/en/countries/greece 

12 

The  completion  of  the  cadastre  project 
requires  the  establishment  of  forest 
maps.  While  forest  maps  for  almost  all  the 
country have been produced, the ratification of 
about  50%  of  them  has  faced  delays  due  to 
the  pandemic,  the  wild  fires  of  last  summer 
and  a  reorganisation  of  the  forestry  services. 
Ratification 
largely 
completed by July 2022. 

is  expected 

to  be 

Supporting people getting into 
work in a systematic manner 

While  the  employment  and  social  impact 
of  the  pandemic  has  been  mitigated, 
unemployment  and  poverty  remain  high. 
Despite having declined markedly  since 2017, 
at  27.5%,  the  share  of  people  at  risk  of 
poverty  or  social  exclusion  (AROPE)  was  well 
above  the  EU  average  (21.9%)  in  2021  and 
energy  poverty  (17.1%)  was  more  than  twice 
as  high  as  in  the  EU  as  a  whole  (8.2%)  in 
2020. Unemployment has been declining since 
2013, but, at around 13%, it is still one of the 
highest  in  the  EU  and  it  disproportionally 
affects  women,  young  people  and 
third 
country  nationals.  In  the  age  range  20-64, 
women  have  30%  less  chances  than  men  to 
be  employed, while almost one fifth of young 
people  (aged  15-29)  are  not  in  employment, 
education  or  training.  Meanwhile,  the  risk  of 
undeclared  and  under  declared  work  remains 
high,  although  efforts  have  been  made  to 
eliminate  the  phenomenon.  Tackling  these 
challenges  will  allow  Greece  to  contribute  to 
the 2030 EU headline targets on employment 
and poverty reduction. 

The effectiveness of active labour market 
policies  is  hampered  by  the  capacity 
constraints  of  the  public  employment 
service.  Around  1.1  million  jobseekers  were 
registered in the public employment service in 
March  2022.  More  than  half  had  been 
registered  for  more  than  12  months  and,  out 
of these, women were twice as many as men. 
A  major  reorganisation  of  the  service  was 
in  2021  along  with  a  sizeable 
initiated 
expansion  of 
its  activation  programmes. 
Nevertheless, capacity constraints remain. The 

 
                                                 
currently  has  470  employment 
service 
counsellors  and  only  about  half  of  its  staff 
deal  directly  with  jobseekers,  which  is  a 
relatively  low  share (23),  while  the  complexity 
of  back-office  administrative  procedures 
prevents a further shift of human resources to 
front-office 
An 
additional 540 counsellors will be recruited on 
a  temporary  basis  in  2022  with  support  from 
the  Recovery  and  Resilience  Facility  until  a 
more  sustainable  structural  solution  to  the 
service's capacity constraints can be found. 

counselling 

functions. 

the 
preparation.  Concerning  natural  gas, 
recently  constructed  Trans  Adriatic  Pipeline 
(TAP)  has  already  allowed  Greece  to  diversify 
sources of natural  gas imports. To ensure the 
infrastructure, 
viability  of  additional  LNG 
ensuring 
existing  gas 
compatibility  of 
distribution networks is key. It should be noted 
that future investments should be future-proof 
where  possible  to  avoid  lock-in  effects.  Last 
but  not  least,  several  interconnection  projects 
are  in  the  development  pipeline,  while  other 
investments remain at a preparatory stage. 

Fostering the green economy and 
reducing energy imports 

Greece  is  moderately  reliant  on  imports 
of energy from Russia. In 2020 (24), natural 
gas  accounted  for  24%  of  Greece’s  energy 
mix, of which 39% was imported from Russia, 
and crude oil accounted for 50% of its energy 
mix,  of  which  18%,  excluding  refined  oil 
products (25),  was  imported  from  Russia.  A 
considerable share of oil imports serves as an 
input to Greece’s large refining industry, which 
is  then  re-exported  in  the  form  of  finished 
petroleum products.  

In  recent  years,  Greece  has  initiated 
actions  to  diversify  energy  supply routes 
and  sources,  and  efforts  are  expected  to 
be intensified in the near future. The new 
geopolitical  situation  calls  on  Greece  to 
reinforce  energy  diversification  efforts,  such 
as  the  ongoing  exploration  of  alternative 
natural gas and oil supply routes. For crude oil, 
an  initial  deal  to  import  more  oil  from  Saudi 
Arabia  was  concluded  in  March  2022,  while 
under 
are 
additional 

currently 

plans 

(23)  Assessment Report on PES Capacity (2020), European 
Network of Public Employment Services, European 
Commission. 

(24)  Eurostat (2020), share of Russian imports over total 
imports of natural gas, crude oil and hard coal. For 
Greece, total imports include intra-EU trade. Crude oil 
does not include refined oil products. 

(25)  An important share of Greece’s total oil imports is 
refinery feedstock. Greece is highly dependent on 
Russian imports for these, with 86% of total refinery 
feedstock imports coming from Russia. 

Greece  remains  committed  to  making  its 
energy  production  more  efficient.  Existing 
lignite-fired  power  plants  are  expected  to  be 
decommissioned  fully  by  2028  accompanied 
by  actions  to  support  a  fair  and  green 
transition  (see  Annexes  5,  6).  In  2021,  the 
share of lignite-based electricity production in 
overall  electricity  production  fell  below  10%. 
At the same time, the use of renewable energy 
in  sectors  such  as  buildings,  construction  and 
low,  while  new  energy 
transport  remains 
sources, such as renewable hydrogen in hard-
to-abate  sectors  such  as  industry,  are  not 
sufficiently  exploited.  There 
is  scope  for 
further decarbonisation efforts in the transport 
sector,  which 
that 
consumes  a  significant  part  of  the  oil,  in 
particular 
further 
investments  on  sustainable  mobility.  To 
promote  renewables,  Greece  is  setting  up  an 
organised  market  platform 
facilitate 
bilateral  power  purchasing  agreements  for 
renewable electricity.  

the  sector 

promoting 

remains 

through 

to 

Greece has set a relatively modest target 
for reducing primary energy consumption 
in  its  national  energy  and 
by  2030 
climate plan. Whereas Greece’s RRP supports 
the setting up of a framework to advance the 
energy  services  market,  additional  reforms, 
including  to  overcome  the  split-incentives 
dilemma (26)  and  to  improve  the  capacity  and 
qualification  of  buildings  professionals,  could 
help  address  existing  market  failures  and 
boost 
The 
continuation  of  the  popular  energy  efficient 
private 
renovation 

programme 

renovation 

energy 

rates. 

for 

(26)  Split incentives occur when those responsible for paying 
energy bills (i.e. the tenant) are not the same as those 
making the capital investment decisions. 

13 

 
                                                 
                                                 
residencies under the RRP and the extension of 
other energy saving measures (27) are positive 
steps, however, a stronger focus on vulnerable 
groups  could  make  these  actions  even  more 
impactful (see Annex 12).  

of  its  scarce  water  resources,  Greece  will 
establish  a  new  water  and  wastewater 
regulatory  authority  as  part  of  its  RRP  (see 
Annex 7). 

The  energy  market  has  undergone  major 
reforms but market participation remains 
low.  The  target  model  for  the  wholesale 
market  has  been 
in  place  since  2020. 
However,  the  liquidity  of  the  energy  markets 
could  be  strengthened  by 
introducing  a 
continuous  intra-day  market  to  improve  the 
active  participation  of  renewables  and  end-
consumers.  In  the  retail  market,  the  market 
share  of  the  Public  Power  Cooperation  is 
currently  close  to  65%,  which  is  significantly 
above 
target  set  by  national 
legislation.  Strengthening  the  energy  markets, 
for  example,  by 
increasing  the  share  of 
renewables,  and  by  making  demand  response 
and  storage  available  to  market  actors,  is 
expected 
competition  and 
investment  in  the  sector,  which  would  benefit 
households and businesses. 

the  50% 

increase 

to 

Waste management and water treatment 
remain  inadequate,  although  efforts  are 
being  made  to  improve  both.  Around  80% 
of  Greece’s  municipal  waste  is  brought  to 
landfill  (vs  24%  in  the  EU)  and  5.4%  of 
material  resources  come  from  recycled  waste 
materials  (vs  12.8%  in  the  EU).  To  address 
these challenges, Greece has recently adopted 
a  waste  management  law  that  introduces 
incentives  for  municipalities  to  achieve  higher 
recycling rates and enforce separate collection 
of  recycling  materials,  while  extending  the 
responsibility of waste producers and creating 
The 
recycling 
the 
implementation  of  this  new  legal  framework 
combined  with  the  new  landfill  tax  and  the 
adoption of updated waste management plans 
by all Greek regions will support the transition 
towards  a  circular  economy.  In  the  area  of 
water management, many small municipalities 
are  still  deprived  of  proper  wastewater 
management  and/or  a  reliable  provision  of 
drinking  water,  while  distribution  leakages 
remain an issue. To improve the management 

necessary 

facilities. 

(27)  For example, the obligation scheme that falls under the 
scope of Article 7 of the EU’s Energy Efficiency Directive 
(2012/27/EU). 

14 

 
                                                 
KEY FINDINGS 
KEY FINDINGS 

Greece’s recovery and resilience plan set out a 
wide-ranging  and  ambitious  response  to  its 
structural challenges through: 

  Investments 

to 

improve 

the  energy 
efficiency  of  public  buildings,  expand 
renewable 
storage 
capacities as well as promoting sustainable 
transport, waste and water management.  

sources, 

energy 

private 

  Investments  in  the  digitalisation  of  public 
administration 
sector 
and 
companies,  in  connectivity  infrastructure 
and  in  digital  skills.  Further  improvements 
in  public  administration  including  the  tax 
administration and justice systems are also 
envisaged.  

  Reforms  and  investments  fostering  labour 
market  activation  and  upskilling,  improving 
the availability of early childhood education 
and  care,  and  upgrading  the  health  care 
system. 

Beyond  the  reforms  and  investments  in 
the RRP, Greece would benefit from: 

  Improving  the  investment  friendliness  of 
taxation system through the introduction of 
a comprehensive advance tax ruling system 
and  the  improvement  of  the  structure  of 
the tax burden on the self-employed.  

  Safeguarding  the  efficiency  of  the  public 
administration  by  ensuring  it  can  attract 
the right skills and maintaining its costs at 
pre-pandemic levels. 

  Enhancing  the  efficiency  of  health  care 
spending  including  by  completing  the  roll-
out of the primary health care system with 
adequate staffing to ensure full population 
coverage. 

  Completing 

the 

cadastre  project  by 
completing  the  cadastral  mapping  and  the 
forest maps. 

  Ensuring effective labour market activation 
support  with  a  particular  focus  on  young 
people  and  women,  and  further  enhancing 
social  policies,  so  as  to  contribute  to  the 
2030  EU  headline  targets  on  employment 
and poverty reduction. 

thereby 

supporting 

  Reducing  dependence  on  fossil  fuels  by  a) 
reducing  overall 
fuel  use  and 
fossil 
accelerating  the  deployment  of  renewable 
energy, including development of hydrogen 
infrastructure, 
the 
decarbonisation of the Greek economy and 
targets;  b)  ensuring 
reaching  national 
sufficient  capacity  of  electricity  and  gas 
interconnections  and  diversifying  energy 
supply  routes;  c)  strengthening  the  energy 
services market framework and stepping up 
delivery  on  energy  efficiency-enhancing 
measures. 

15 

 
 
 
ANNEXES 

 
 
 
LIST OF ANNEXES 

Cross-cutting progress indicators 

Annex 1: Sustainable Development Goals 

Annex 2: Recovery and Resilience Plan Implementation 

Annex 3: Other EU instruments for recovery and growth 

Annex 4: Progress in the implementation of country-specific recommendations 

Environmental sustainability 

Annex 5: Green Deal 

Annex 6: Employment and social impact of the green transition 

Productivity 

Annex 7: Resource efficiency and productivity 

Annex 8: Digital transition 

Annex 9: Innovation 

Annex 10: Industry and single market 

Annex 11: Public administration 

Fairness 

Annex 12: Employment, skills and social policy challenges in light of the European Pillar of Social Rights 

Annex 13: Education and skills 

Annex 14: Health and health systems 

Annex 15: Economic and social performance at regional level 

Macroeconomic Stability 

Annex 16: Key financial sector developments 

Annex 17: Macroeconomic Imbalance Procedure assessment matrix 

Annex 18: Taxation 

Annex 19: Key economic and financial indicators 

Annex 20: Debt sustainability analysis 

LIST OF TABLES 

Table A2.1: 
Table A4.1: 
Table A5.1: 
Table A7.1: 
Table A8.1: 

Key elements of the Greek RRP 
Summary table on 2019,2020 and 2021 CSRs 
Indicators underpinning progress on the European Green Deal from a macroeconomic perspective 
Selected resource efficiency indicators 
Key Digital Economy and Society Index Indicators 

19 

21 

21 

23 

25 

28 

30 

30 

33 

35 

35 

37 

39 

41 

43 

45 

45 

47 

49 

51 

54 

54 

56 

58 

60 

61 

23 
29 
32 
36 
38 

 
 
 
Table A9.1: 
Table A10.1: 
Table A11.1: 
Table A12.1: 
Table A13.1: 
Table A14.1: 
Table A15.1: 
Table A16.1: 
Table A17.1: 
Table A18.1: 
Table A19.1: 

Key research, development and innovation indicators 
Key Single Market and Industry Indicators 
Public administration indicators – Greece 
Social scoreboard for Greece 
EU-level targets and other contextual indicators under the European Education Area strategic framework 
List of key indicators, health 
Selected indicators at regional level – Greece 
Financial soundness indicators 
Assessment of Macroeconomic Imbalances matrix 
Taxation indicators 
Key economic and financial indicators 

LIST OF GRAPHS 

Graph A1.1: 

Progress towards SDGs in Greece in the last five years 

Graph A2.1: 

Total grants disbursed under the RRF 

Graph A2.2: 

Total loans disbursed under the RRF 

Graph A2.3: 

Fulfilment status of milestones and targets 

Graph A2.4: 

Share of RRF funds contributing to each policy pillar 

Graph A3.1: 

2014-2020 European Structural and Investment Funds – total budget by fund (1) 

Graph A3.2: 

Cohesion policy contribution to the SDGs (1) 

Graph A4.1: 

Greece’s progress on the 2019-2020 CSRs (2022 European Semester cycle) 

Graph A5.1: 

Fiscal aspects of the green transition: Taxation and government expenditure on environmental protection 

Graph A5.2: 

Thematic - Energy: Share in energy mix (solids, oil, gas, nuclear, renewables) 

Graph A5.3: 

Thematic - Biodiversity: Terrestrial protected areas and organic farming 

Graph A5.4: 

Thematic - Mobility: Share of zero emission vehicles (% of new registrations) 

Graph A6.1: 

Fair green transition challenges 

Graph A6.2: 

Energy poverty by income decile 

Graph A7.1: 

Economic importance and expansion of the circular economy - employment and value added in the circular economy 

sectors 

Graph A11.1: 

Performance on evidence-based policy making indicators 

Graph A11.2: 

Performance on the single market public procurement indicator 

Graph A13.1: 

Low achievement in reading by socioeconomic status, PISA 2018 

Graph A14.1: 

life expectancy at birth, years 

Graph A14.2: 

Projected increase in public expenditure on health care over 2019-2070 (AWG reference scenario) 

Graph A15.1: 

CO2 emissions from fossil fuels per head, 2018 (Greece) 

Graph A15.2: 

Territories most affected by the climate transition in Greece 

Graph A15.3: 

Regional performance groups (2021) 

Graph A18.1: 

Tax wedge indicators 

Table A20.1: 

Debt sustainability analysis for Greece 

Table A20.2: 

Heat map of fiscal sustainability risks for Greece 

40 
42 
44 
45 
48 
50 
53 
54 
57 
58 
60 

22 

23 

23 

24 

24 

25 

26 

28 

30 

30 

31 

31 

34 

34 

35 

43 

43 

47 

49 

49 

51 

51 

52 

59 

62 

62 

20 

 
 
 
 
CROSS-CUTTING PROGRESS INDICATORS 
ANNEX 1: SUSTAINABLE DEVELOPMENT GOALS 
ANNEX 1: SUSTAINABLE DEVELOPMENT GOALS 

of 

four 

dimensions 

This Annex assesses Greece’s progress on the 
Sustainable Development Goals (SDGs) along 
the 
competitive 
sustainability.  The  17  SDGs  and  their  related 
indicators  provide  a  policy  framework  under  the 
UN’s  2030  Agenda  for  Sustainable  Development. 
The  aim  is  to  end  all  forms  of  poverty,  fight 
inequalities  and  tackle  climate  change,  while 
ensuring that no one is left behind. The EU and its 
Member  States  are  committed  to  this  historic 
global  framework  agreement  and  to  playing  an 
active  role  in  maximising  progress  on  the  SDGs. 
The graph below is based on the EU SDG indicator 
set  developed  to  monitor  progress  on  SDGs  in  an 
EU context. 

While  Greece  performs  very  well  or 
is 
improving  on  several  SDG  indicators  related 
to environmental sustainability  (SDGs 7 and 
12), it still needs to catch up on others (SDGs 
9, 11 and 13). Greece has taken important steps 
to meet climate action goals (SDGs 13). By 2020, 
the  share  of  renewable  energy  in  gross  final 
energy  consumption  had  almost  reached  the  EU 
average  (21.7%  vs  22.1%),  albeit  starting  from  a 
lower level. Greece has also fared particularly well 
on  net  greenhouse  gas  emissions,  with  emissions 
falling  by  28%  between  2015  and  2020  bringing 
Greece  to  a  better  position  than  the  EU  average. 
Access to affordable energy (SDG 7) has improved 
markedly  since  2015,  but  the  share  of  Greece’s 
population  that  is  unable  to  keep  their  home 
adequately warm remains twice as high as the EU 
average  (17.1%  vs  8.2%).  Progress  with  meeting 
responsible consumption and production objectives 
(SDG  12)  has  been  mixed.  Energy  productivity 
increased  by  8%  between  2015  and  2020  but 
remained  well  below  the  EU  average.  Generation 
of waste excluding major mineral wastes dropped 
by  around  30% 
increased 
marginally  in  the  EU,  while  CO2 emissions  per  km 
from  new  passenger  cars  increased  slightly  in 
Greece but went up by 10% in the EU.  

in  Greece  and 

Greece  is  improving  on  some  SDG  indicators 
related to fairness (SDGs 2 and 10), it needs 
to catch up on others (SDGs 1, 3, 4, 5, and 8). 
While  Greece’s  labour  market  and  social  situation 
has  improved  overall  over  the  last  5  years,  it 
remains less favourable overall than in the EU. The 
share  of  severely  materially  and  socially  deprived 
people  stood  at  14.9%  in  2020  as  compared  to 
only  6.9%  in  the  EU,  while  one  third  of  Greece’s 

population 
(32.6%)  was  overburdened  with 
housing costs as compared to only 1 in 10 in the 
EU  (SDG 1). Certain equality aspects (SDGs 5 and 
10)  have  shown  some  improvement,  but  overall 
they  remain  less  positive  than  in  the  EU  as  a 
whole.  In  2020,  the  employment  rate  of  women 
was  lower  than  that  of  men  by  19.4  percentage 
points  (as  compared  to  11  points  in  the  EU). 
Women  held  only  19.6%  of  senior  management 
positions  and  21.3%  of  political  positions  (as 
opposed  to  30.6%  and  33.1%  respectively  in  the 
EU).  People  in  rural  areas  in  Greece  face  a 
disproportionally  higher  risk  of  poverty  or  social 
inclusion compared to the EU as a whole.  Turning 
to  health  aspects  (SDG  3),  while  healthy  life 
expectancy (66 years) is slightly higher than in the 
EU  (64.6  years)  and  more  people  report  being 
healthy  (78.5  vs  69.5%),  a  higher  and  increasing 
share of people smoke (42% in 2020 as opposed 
to  25%  in  the  EU).  Despite  improving  over  time, 
access  to  healthcare  remains  challenging,  with 
6.5%  of  the  population  reporting  unmet  medical 
needs  in  2020  due  to  cost,  distance  or  waiting 
times as opposed to only 1.8% in the EU. 

and 

education 

Greece  needs  to  catch  up  on  SDG  indicators 
related  to  productivity  (SDGs  4,  8  and 
9). Greece’s 
innovation 
performance (SDGs 4 and 9) is mixed with better-
than-EU  average  results  in  early  school  leaving 
(3.8% vs 9.9%)  and tertiary education attainment 
(43.7%  vs  40.5%),  but  with  large  gaps in  reading 
underachievement 
(30.5%  vs  22.5%),  early 
childhood education attendance (68.8% vs 92.8%), 
adult  learning  participation  (4.1%  vs  9.2%),  basic 
digital  skills  (52%  vs  54%)  and  R&D  spending 
(1.49%  of  GDP  vs  2.32%).  Decent  work  and 
(SDG  8)  have 
indicators 
economic  growth 
improved  in  the  aftermath  of  Greece’s  deep  and 
long  economic  crisis,  but  remain  less  favourable 
than  in  other  Member  States,  as  reflected  in  the 
low  employment  rate  (58.3%  vs  72.4%)  and  the 
still  high  share  of  long-term  unemployed  people 
(10.5% vs 2.4%) and young people who are not in 
employment,  education  or  training  (18.7%  vs 
13.7%). 

Greece  needs  to  catch  up  on  SDG  indicators 
related  to  macroeconomic  stability  (SDGs  8 
and  16).  Greece’s  GDP  per  capita  stood  at 
EUR 16 170  in  2020,  corresponding  to  around 
60%  of  the  EU  average 
(EUR 26 380)  and 
investment  was  markedly  low  (11.7%  of  GDP  in 

21 

 
 
 
 
2020  vs  22.3%  in  the  EU)  (SDG  8).  Meanwhile,  a 
higher  share  of  the  population  (19.2%)  reported 
crime, violence or vandalism in their area (SDG  

16). 

Graph A1.1: Progress towards SDGs in Greece in the last five years 

Note:  For detailed datasets on the various SDGs see the annual ESTAT report ‘Sustainable development in the European Union’ 
https://ec.europa.eu/eurostat/product?code=KS-09-22-019; Extensive country specific data on the short-term progress of Member 
States can be found here: Key findings - Sustainable development indicators - Eurostat (europa.eu) 
Source: Eurostat, latest update of 28 April 2022. Data mainly refer to 2015-2020 and 2016-2021. 

22 

 
 
 
 
 
ANNEX 2: RECOVERY AND RESILIENCE PLAN IMPLEMENTATION 
ANNEX 2: RECOVERY AND RESILIENCE PLAN IMPLEMENTATION 

its 

The  Recovery  and  Resilience  Facility  (RRF)  is 
the  centrepiece  of  the  EU’s  efforts  to 
support  its  recovery  from  the  COVID-19 
pandemic,  fast  forward  the  twin  transition 
and  strengthen  resilience  against  future 
shocks.  Greece  submitted 
recovery  and 
resilience  plan 
(RRP)  on  27 April  2021.  The 
Commission’s  positive  assessment  on  17 June 
2021  and  Council’s  approval  on  13 July  2021 
paved  the  way  for  disbursing  EUR 17.8  billion  in 
grants and EUR 12.7 billion in loans under the RRF 
in 2021-2026. The financing and loan agreements 
were signed on 23 and 26 July 2021 respectively, 
and  the  operational  arrangement  was  signed  on 
21 December  2021.  The  key  elements  of  the 
Greek RRP are set out in Table A2.1. 

Table A2.1: Key elements of the Greek RRP 

reports a timely implementation of the milestones 
and  targets  due  by  the  end  of  Q1-2022,  which 
however  does  not  prejudge  the  timing  of  the 
submission  of  subsequent  payment  requests  or 
the  formal  assessment  of  the  fulfilment  of  the 
relevant milestones and targets. 

Greece's progress in implementing its plan is 
in  the  Recovery  and  Resilience 
set  out 
Scoreboard.  The  Scoreboard  also  gives  a  clear 
overview  of  the  progress  made  in  implementing 
the  RRF  as  a  whole.  The  graphs  below  show  the 
current state of play of the milestones and targets 
achieved, as declared by Greece and confirmed by 
the Commission. 

Graph A2.1: Total grants disbursed under the RRF 

Note: See Pfeiffer P., Varga J. and in ’t Veld J. (2021), 
“Quantifying Spillovers of NGEU investment”, European 
Economy Discussion Papers, No. 144 and Afman et al. (2021), 
“An overview of the economics of the Recovery and Resilience 
Facility”, Quarterly Report on the Euro Area (QREA), Vol. 20, 
No. 3 pp. 7-16. 
Source: European Commission 

Note: This graph displays the amount of grants disbursed so 
far under the RRF. Grants are non-repayable financial 
contributions. The total amount of grants given to each 
Member State is determined by an allocation key and total 
estimated cost of the respective recovery and resilience plan.          
Source: RRF Scoreboard 
https://ec.europa.eu/economy_finance/recovery-and-resilience-
scoreboard/country_overview.html 

The  share  of  funds  contributing  to  each  of 
the  RRF’s  six  policy  pillars  is  outlined  in  the 
graph below.  

Graph A2.2: Total loans disbursed under the RRF 

The 

Commission 

The implementation of the Greek plan is well 
under  way. 
disbursed 
EUR 4 billion  to  Greece  in  pre-financing  in  August 
  financial 
2021,  equivalent  to  13%  of  the 
allocation,  to  support  the 
implementation  of 
crucial  investments  and  reforms.  Greece’s  first 
payment  request  was  positively  assessed  by  the 
Commission, taking into account the opinion of the 
Economic  and  Financial  Committee,  leading  to  a 
disbursement  of  EUR  3.6  billion 
in  financial 
support  (net  of  pre-financing)  on  8  April.  The 
reforms  and 
related  15  milestones  cover 
investments  in  the  areas  of  energy  efficiency, 
electric  mobility,  waste  management, 
labour 
market,  taxation,  healthcare  and  the  audit  and 
fulfilment 
control  system.  Their  satisfactory 
contributes  to  addressing  the  related  country-
specific  recommendations  addressed  to  Greece  in 
2019  and  2020,  see  Annex  4.  Overall,  Greece 

Note: This graph displays the amount of loans disbursed so 
far under the RRF. Loans are repayable financial contributions. 
The total amount of loans given to each Member State is 
determined by the assessment of its loan request and cannot 
exceed 6.8% of its 2019 GNI. 
Source: RRF Scoreboard  
https://ec.europa.eu/economy_finance/recovery-and-resilience-
scoreboard/country_overview.html 

23 

 
 
 
 
 
 
 
 
 
 
Graph A2.3: Fulfilment status of milestones and 
targets 

Note: This graph displays the share of fulfilled milestones 
and targets. A milestone or target is fulfilled once a Member 
State has provided the evidence to the Commission that it has 
completed the milestone or target and the Commission has 
assessed it positively in an implementing decision.                      
Source: Source: RRF Scoreboard 
https://ec.europa.eu/economy_finance/recovery-and-resilience-
scoreboard/country_overview.html 

Graph A2.4: Share of RRF funds contributing to each policy pillar 

Note: Each measure contributes towards two policy areas of the six pillars, therefore the total contribution to all pillars displayed 
on this chart amounts to 200% of the estimated cost of the Greek RRP. The bottom part represents the amount of the primary 
pillar, the top part the amount of the secondary pillar.  
Source: RRF Scoreboard, https://ec.europa.eu/economy_finance/recovery-and-resilience-scoreboard/country_overview.html 

24 

 
 
 
 
ANNEX 3: OTHER EU INSTRUMENTS FOR RECOVERY AND GROWTH 
ANNEX 3: OTHER EU INSTRUMENTS FOR RECOVERY AND GROWTH 

The EU’s budget of more than EUR 1.2 trillion 
for  2021-2027  is  the  investment  lever  to 
help  implement  EU  priorities.  Underpinned  by 
an  additional  amount  of  about  EUR  800  billion 
largest 
through  NextGenerationEU  and 
instrument, the Recovery and Resilience Facility, it 
represents  significant  firepower  to  support  the 
recovery and sustainable growth. 

its 

Graph A3.1: 2014-2020 European Structural and 
Investment Funds – total budget by fund (1) 

In 2021-2027, EU cohesion policy funds (28) will 
support  long-term  development  objectives  in 
Greece.  They  will  allow 
investing  EUR 21.3 
billion (29),  including  EUR 1.3  billion  from  the  Just 
Transition  Fund,  to  alleviate  the  socio-economic 
impacts  of  the  green  transition 
in  the  most 
vulnerable  regions.  The  2021-2027  cohesion  policy 
funds partnership agreements and programmes take 
into  account 
the  2019-2020  country-specific 
recommendations and investment guidance provided 
as part of the European Semester, ensuring that this 
money  fully  complements  other  EU  funding.  In 
addition,  Greece  will  benefit  from  EUR  13.5  billion 
support  for  the  2023-27  period  from  the  Common 
Agricultural 
social, 
environmental,  and  economic  sustainability  and 
innovation in agriculture and rural areas, contributing 
to the European Green Deal, and ensuring long-term 
food security. 

Policy,  which 

supports 

Note: The data for the EAFRD and REACT-EU refer to the 
period 2014-2022. 
(1) EUR billion,% 
Source: European Commission 

In  2014-2020,  the  European  Structural  and 
Investment Funds (ESIF) for Greece were set 
to  invest  EUR  24.8  billion (30)  from  the  EU 
budget.  The  total  investment,  including  national 
financing,  amounts  to  EUR  55.32  billion  (Graph 
A3.1),  representing  around  2.37%  of  GDP  for 
2014-2020  and  78.31% of  public  investment (31). 
By  31 December  2021,  127%  of  the  total  had 
been  allocated  to  specific  projects  and  EUR 15.2 
billion    was  reported  as  spent,  leaving  EUR 9.6 
billion  to  be  spent  by  the end  of  2023 (32).  All  11 
thematic objectives are relevant for Greece. By the 
end  of  2020,  cohesion  policy 
investments 
supported  some  140 241  enterprises,  improved 
for  1 516 
research 
researchers,  provided  39 382  households  with 
improved  energy  consumption  classification  and 
4 893  928  people  with  improved  health  services. 
long-term  unemployed 
In  addition,  250 000 
participated  in  funded  projects,  240 000  people 
gained a qualification and 241 community centres 
serving as one-stop-shops for social services were 
established  all  over  Greece.  The  potential  GDP 
impact  of  the  2014-2020  investments  of  the 

infrastructure 

facilities 

(30)  ESIF includes cohesion policy funds (ERDF, ESF+, CF, Interreg, 
EAFRD and EMFF). According to the ‘N+3 rule’ the funds 
committed for the years 2014-20 must be spent by 2023 at 
latest (by 2025 for EAFRD). Data source: Cohesion Open 
data, cut-off date 31.12.2021 for ERDF, ESF+, CF, Interreg; 
cut-off date 31.12.2020 for EAFRD and EMFF. 

(28)  European Regional Development Fund (ERDF), European 

(31)  Public investment is gross fixed capital formation plus 

Social Fund+ (ESF+), Cohesion Fund (CF), Just Transition Fund 
(JTF), Interreg. 

(29)  Current prices, source: Cohesion Open Data. 

capital transfers, general government. 

(32)  Including REACT-EU. ESIF data on. 

https://cohesiondata.ec.europa.eu/countries/GR 

25 

 
 
                                                 
 
                                                 
 
three  main  cohesion  policy  funds  (ERDF,  CF,  ESF) 
for  Greece  is  estimated  at  +2.19%  in  2023  and 
+1.37%  in  2033  compared  to  the  GDP  of  a 
scenario without cohesion policy (33).  

Graph A3.2: Cohesion policy contribution to the 
SDGs (1) 

(1) EUR billion 
Source: European Commission 

Cohesion  policy  funds  already  substantially 
contribute  to  the  Sustainable  Development 
Goals  (SDGs).  In  Greece,  cohesion  policy  funds 
support  11 of the  17  SDGs, with up to 93% of the 
expenditure  contributing  to  the  attainment  of  the 
goals. 

Cohesion  policy  funds  already  substantially 
contribute  to  the  Sustainable  Development 
Goals  (SDGs).  In  Greece,  cohesion  policy  funds 
support  11  of  the  17  SDGs,  with  up  to  93%  of  the 
expenditure  contributing  to  the  attainment  of  the 
goals.  

REACT-EU 

instrument 

The 
(Recovery 
Assistance  for  Cohesion  and  the  Territories 
of  Europe)  under  NextGenerationEU  provided 
EUR 1 708  billion  of  additional  funding  to  2014-
2020  cohesion  policy  allocations  for  Greece  to 
ensure  a  balanced  recovery,  boost  convergence 
and  provide vital  support  to  regions  following  the 
coronavirus outbreak. REACT-EU support to Greece 
focuses  on  addressing  the  effects  of  the  COVID-
19  crisis  by 
funding  entrepreneurship  and 
strengthening primary healthcare. 

to 

for 

reallocate 

to  Greece 

The  Coronavirus  Response 
Investment 
Initiative (34) provided the first EU emergency 
support 
the  COVID-19 
pandemic.  It  introduced  extraordinary  flexibility 
resources  for 
enabling  Greece 
immediate  public  health  needs  (EUR  426  million) 
and to support businesses (EUR 1 775 million). For 
instance,  Greece  redirected  funds  to  purchase 
protective  equipment  and  healthcare  material,  to 
reinforce  healthcare  staff  and  working  capital  for 
SMEs,  and  to  digitalise  the  education  system  and 
the  public  administration.  Greece  also  benefited 
from  the  temporary  100%  EU  financing  of 
cohesion  policy  measures,  with  approximately 
EUR 590 million being financed at 100% in 2021. 

for 

risks 

temporary 

unemployment 

support 
in 

Greece  received  support  under  the  European 
to 
instrument 
mitigate 
an 
emergency  (SURE)  to  finance  short-time  work 
schemes  and  similar  measures. The  Council 
granted financial assistance under SURE to Greece 
in  September  2020  and  top-up  support  in  April 
2021  for  a  maximum  of  EUR 5 265  billion,  which 
was disbursed by 25 May 2021. SURE is estimated 
to  have  supported  approximately  35%  of  workers 
and  45%  of  firms  for  at  least  1  month  in  2020 
and  15%  of  workers  and  30%  of  firms  in  2021, 
primarily  in  accommodation  and  food  services, 
wholesale  and  retail  trade,  and  manufacturing. 
Greece  is  estimated  to  have  saved  a  total  of 
EUR 0.51  billion  on  interest  payments  as  a  result 
of SURE’s lower interest rates. 

The  Commission  provides  tailored  expertise  to 
Greece under the Technical Support Instrument 
to help design and implement growth-enhancing 
reforms,  including  those  planned  in  the  RRP. 
Since  2015,  Greece  has  received  assistance  through 
more  than  200  technical  support  projects.  Projects 
carried out in 2021 aimed for example to support the 
digital  transformation  of  public  administration  by 
assisting  with  the  design  and  communication  of  a 
comprehensive digital governance policy for the Greek 
public  sector.  The  Commission  also  provided  Greece 
with  capacity  building  support  to  monitor,  coordinate 
and evaluate its reforms and to help it prepare its RRP. 
Greece  also  receives  ongoing  support  to  implement 
specific  reforms  and investments planned in its  RRP, 
such as modernising the legal framework of the public 

(33)  Crucitti, F., Lazarou, N., Monfort, P., and Salotti, S. (2022). The 
RHOMOLO impact assessment of the 2014-2020 cohesion 
policy in the EU regions. JRC Working Papers on Territorial 
Modelling and Analysis No 01/2022, European Commission, 
Seville, JRC128208. 

(34)  Reallocating ESIF resources according to Regulation (EU) 

2020/460 of the European Parliament and of the Council of 
30 March 2020, and Regulation (EU) 2020/558 of the 
European Parliament and of the Council of 23 April 2020. 

26 

 
 
                                                 
                                                 
investment  programme,  and  preparing  a  strategy  on 
the quality of healthcare. In 2022, a new project will 
be launched to support sustainable urban mobility.  

Greece  also  benefits 
from  other  EU 
programmes,  such  as  the  Connecting  Europe 
Facility, which allocated EUR 615.7 million to 
specific  projects  on  strategic  transport 
networks, and Horizon 2020, which allocated 
EU funding of EUR 1 700.0 million.  

27 

 
ANNEX 4: PROGRESS IN THE IMPLEMENTATION OF COUNTRY-SPECIFIC 
ANNEX 4: PROGRESS IN THE IMPLEMENTATION OF COUNTRY-SPECIFIC 
RECOMMENDATIONS  
RECOMMENDATIONS  

Graph A4.1: Greece’s progress on the 2019-2020 
CSRs (2022 European Semester cycle) 

Source: European Commission 

budgetary, 

recommendations 

(CSRs) 
Country-specific 
provide  guidance  to  Member  States  on 
economic, 
employment  and 
structural  policies.  They  aim  to  strengthen 
sustainable  growth  and 
job  creation,  while 
achieving  or  maintaining  sound  public  finances, 
preventing  excessive  macroeconomic  imbalances 
and fostering the twin transition. 

recommendations 

the  2019-2021 
The  Commission  assessed 
(CSRs) (35) 
country-specific 
in  the  context  of  the 
addressed  to  Greece 
European  Semester.  The  assessment  takes  into 
account  the  policy  action  taken  by  Greece  to 
date (36),  as  well  as  the  commitments  in  the 
Recovery and Resilience Plan (RRP) (37) At this early 
stage  of  the  RRP  implementation,  overall  80%  of 
the CSRs focusing on structural issues in 2019 and 
2020  have  recorded  at  least  “some  progress”, 
while  20%  recorded  “limited”  (see  Graph  A4.1). 
Considerable  additional  progress  in  addressing 
structural  CSRs  is  expected  in  the  years  to  come 
with the further implementation of the RRP.  

(35)  2021 CSRs: https://eur-lex.europa.eu/legal-

content/EN/TXT/?uri=CELEX%3A32021H0729%2808%29&qi
d=1627675454457 

2020 CSRs: EUR-Lex - 32020H0826(08) - EN - EUR-Lex 

(europa.eu)  

2019 CSRs:  EUR-Lex - 32019H0905(08) - EN - EUR-Lex 

(europa.eu) 

(36)  Incl. policy action reported in the National Reform 

Programme, as well as in the RRF reporting (bi-annual 
reporting on the progress with implementation of milestones 
and targets and resulting from the payment request 
assessment). 

(37)  Member States were asked to effectively address all or a 

significant subset of the relevant country-specific 
recommendations issued by the Council in 2019 and 2020 in 
their RRPs. The CSR assessment presented here takes into 
account the degree of implementation of the measures 
included in the RRP and of those done outside of the RRP at 
the time of assessment.  Measures foreseen in the annex of 
the adopted Council Implementing Decision on the approval 
of the assessment of the RRP which are not yet adopted nor 
implemented but considered as credibly announced, in line 
with the CSR assessment methodology, warrant “limited 
progress”. Once implemented, these measures can lead to 
“some/substantial progress” or “full implementation”, 
depending on their relevance. 

28 

Limited Progress20%Some Progress60%Substantial Progress20% 
 
                                                 
 
   
 
 
Table A4.1: Summary table on 2019,2020 and 2021 CSRs 

(*) See footnote 36.  
(**) Measures indicated as “being implemented as of 2021” are only those included in the first RRF payment request submitted by 
Greece and positively assessed by the European Commission. 
Source: European Commission 

29 

 
 
 
 
ENVIRONMENTAL SUSTAINABILITY 
ENVIRONMENTAL SUSTAINABILITY 
ANNEX 5: GREEN DEAL 
ANNEX 5: GREEN DEAL 

intends 

The  European  Green  Deal 
to 
transform the  EU  into a  fair and prosperous 
society,  with  a  modern,  resource-efficient 
and competitive economy where there are no 
net  emissions  of  greenhouse  gases  in  2050 
and  where  economic  growth  is  decoupled 
from resource use. This annex offers a snapshot 
of  the  most  significant  and  economically  relevant 
developments in Greece  in  the  respective  building 
blocks  of 
is 
complemented by Annex 6 on the employment and 
social impact of the green transition and Annex 7 
for circular economy aspects of the Green Deal. 

the  European  Green  Deal. 

It 

Greece’s  greenhouse  gas  (GHG)  emission 
intensity is still substantially higher than the 
EU  average,  and  there  is  still  major  scope  to 
decarbonise Greece’s economy. The country’s total 
greenhouse  gas  emissions  (excluding  land  use, 
land-use  change  and  forestry  activities)  have 
decreased  since  1990,  although  less  markedly 
than  the  EU  average.  Emissions  per  capita  are 
slightly above the EU average. Greece is expected 
to overachieve its current 2030 emission reduction 
target  under  the  EU  Effort  Sharing  Regulation  (-
16%,  with  the  ESR  target  proposed  by  the 
Commission  in  its  Fit  for  55  package  being  -
22.7%). The scope for GHG emission reductions in 
the  waste  and  transport  sector  is  still  significant. 
Greece's national energy and climate plan projects 
a further decrease of net removals in the land use 
and  forestry  sector  by  2030.  In  its  recovery  and 
resilience  plan  (RRP),  Greece  allocates  37.5%  of 
the  available  funds  to  climate  objectives  and 
outlines  crucial  reforms  and 
investments  to 
accelerate  the  transition  to  a  more  sustainable, 
low-carbon  and  climate-resilient  economy.  Greece 
met its 2020 renewable energy target and has an 
ambitious 2030 goal.  

Greece  is  collecting  high  environmental  tax 
revenues. As a share of total tax revenues as well 
as  GDP,  Greek  energy  and  transport  tax  revenues 
are  much  higher  than  the  EU  average,  and  have 
remained  fairly  stable  over  time.  In  contrast, 
resource and pollution taxes are very low (38).  The 
share  of  expenditure  on  environmental  protection 
in total government expenditure is higher than the 
EU average (Graph A5.1). 

(38)  For more information on taxation see Annex 18. 

Graph A5.1: Fiscal aspects of the green transition: 
Taxation and government expenditure on 
environmental protection 

Source: Eurostat 

Graph A5.2: Thematic - Energy: Share in energy mix 
(solids, oil, gas, nuclear, renewables) 

(1) The share of renewables includes waste 
(2) The energy mix is based on gross inland consumption, and 
excludes heat and electricity. The share of renewables 
includes biofuels and non-renewable waste. 
Source: Eurostat 

Greece’s  energy  mix  has  been  historically 
reliant  on  fossil  fuels.  In  2020,  the  share  of 
natural  gas  in  the  gross  inland  consumption  of 
energy  reached  24%,  while  solid  fuels  and  oil 
accounted  for  9%  and  50%  respectively.  With  an 
ambitious  national  energy  and  climate  plan, 
Greece  has  decided  to  decommission  its  lignite 
plants by 2028 (most by 2023) and almost double 
renewable energy by 2030, which reached 17% of 
final  inland  consumption  of  energy  in  2020.  As 
Greece intends to continue to use natural gas as a 
transitional fuel, by 2030, gas and renewables will 
increase  their  share  in  the  energy  mix,  while  coal 
will  virtually  disappear  and  oil  will  decline 
considerably. 

In  terms  of  biodiversity  and  ecosystem 
health,  Greece  presents  a  mixed  picture.  By 
2021,  27.6%  of  the  national  land  area  of  Greece 

30 

 
 
 
                                                 
 
 
 
 
 
was covered by Natura 2000 (EU average 18.1%), 
with  Special  Protection  Areas  (SPAs)  classified 
under  the  Birds  Directive  covering  20%  (EU 
average  12.3%)  and  Sites  of  Community 
Importance  (SCIs)  under  the  Habitats  Directive 
covering  15%  (EU  average  13.8%)  of  the  Greek 
territory. The latest assessment of the SCI part of 
the  Natura  2000  network  shows  that  Greece’s 
Natura  2000  network  is  now  considered  to  be 
complete. Today, the Natura 2000 network covers 
19.6% of the country's total sea area. Considering 
both Natura 2000 and other nationally designated 
protected  areas, Greece  legally protects  35.2%  of 
its  land  areas  (EU  average  26%)  and  4.6%  of  its 
marine areas (EU average 8%). 

transport. Furthermore, better use should be made 
of  the  rail  connection  between  Athens  and 
Thessaloniki  to  reduce  the  number  of  short  haul 
flights  between  these  two  major  cities.  Finally, 
there are no zero or low emission passenger ships 
connecting the islands with the mainland. 

Graph A5.3: Thematic - Biodiversity: Terrestrial 
protected areas and organic farming 

(1) For terrestrial protected areas data for 2018, and data for 
the EU average (2016, 2017) is lacking.” 
Source: EEA (terrestrial protected areas) and Eurostat 
(organic farming) 

Graph A5.4: Thematic - Mobility: Share of zero 
emission vehicles (% of new registrations) 

(1) Zero emission vehicles (passenger cars) include battery 
and fuel cell electric vehicles (BEV, FCEV). 
Source: European Alternative Fuels Observatory 

to 

fine 

Air  quality  in  Greece  continues  to  be  a 
serious  concern.  The  latest  available  annual 
estimates  by  the  European  Environment  Agency 
to  about  10 400  premature  deaths 
point 
particulate  matter 
attributable 
concentrations,  650  to  ozone  concentrations  and 
2 310  to  nitrogen  dioxide  concentrations (39).  The 
emissions of several air pollutants have decreased 
significantly  in  Greece  over  the  last  years,  while 
GDP  growth  continued.  According  to  the  latest 
projections  (as  submitted  under  Article 10(2)  of 
the  National  Emission  Reduction  Commitments 
Directive)  Greece  expects  to  fulfil  its  emission 
reduction  commitments  for  all  air  pollutants 
covered  by  the  directive  for  2020-2029  and  for 
2030  onwards.  For  2020,  exceedances  above  the 
EU  air  quality  standards  were  registered  for 
nitrogen  dioxide  (NO2)  in one  air  quality  zone  and 
for  particulate  matter 
in  two  zones. 
Furthermore,  for  several  air  quality  zones  the 
target values on ozone concentration are not being 
met. 

(PM10) 

The  transition  to  a  sustainable  transport 
system remains a key challenge. Greece is well 
behind  in  the  adoption  of  electric  vehicles.  The 
market  for  zero-emission  passenger  cars  is  low, 
mirrored by the lack of charging infrastructure and 
the  fact  that  Greece  has  among  the  highest 
congestion  rates  in  the  EU.  Investments  and 
reforms  included  in  the  recovery  and  resilience 
plan  aim  to  contribute  to  addressing  these 
challenges, in particular through the installation of 
publicly  accessible  charging  stations.  The  air 
quality  issues  noted  above  are  also  connected  to 

(39)  These figures refer to the impacts of individual pollutants, 

and to avoid double-counting cannot be added up to derive a 
sum. 

31 

 
                                                 
 
 
 
 
Table A5.1: Indicators underpinning progress on the European Green Deal from a macroeconomic 
perspective 

(1) The 2030 non-ETS GHG target is based on the Effort Sharing Regulation. The Fit for 55 targets are based on the Commission proposal to increase the EU’s 
climate ambition by 2030. Renewables and energy efficiency targets and national contributions under the Governance Regulation (Regulation (EU) 2018/1999).  
(2) Distance to target is the gap between 2030 Effort Sharing Regulation targets and projected emissions with existing measures (WEM) and with additional 
measures (WAM) as a percentage of 2005 base year emissions. 
(3) Percentage of total revenues from taxes and social contributions (excluding imputed social contributions). Revenues from the Emissions Trading System are 
included in environmental tax revenues. For reference, in 2017 ETS revenues amounted to 1.5% of total environmental tax revenues at the EU level. 
(4) Covers expenditure on ‘gross fixed capital formation’ to be used for the production of environmental protection services (i.e. abatement and prevention of 
pollution) covering all sectors, i.e. government, industry and specialised providers. 
(5) The climate protection gap indicator is part of the EU adaptation strategy adopted in February 2021, and is defined as the share of non-insured economic 
losses caused by climate-related disasters.  
(6) Sulfur oxides (SO2 equivalent), ammonia, particulates < 10µm, nitrogen oxides in total economy (divided by GDP). 
(7) Transportation and storage (NACE Section H). 
(8) Zero-emission vehicles include battery electric vehicles and fuel cell electric vehicles. 
(9) European Commission Report (2019) ‘Benchmarking smart metering deployment in the EU-28’. 
(10) European Commission (2021). Each year the Digital Economy and Society Index is recalculated for all countries for previous years to reflect any possible 
change in the choice of indicators and corrections to the underlying data. Country scores and rankings may therefore differ compared with previous publications. 
Source: Eurostat, JRC, European Commission, EEA, EAF 

32 

 
 
 
 
ANNEX 6: EMPLOYMENT AND SOCIAL IMPACT OF THE GREEN TRANSITION 
ANNEX 6: EMPLOYMENT AND SOCIAL IMPACT OF THE GREEN TRANSITION 

The  green  transition  not  only  encompasses 
environmental 
to 
improvements 
sustainability, but also includes a significant 
social dimension.  While measures in this regard 
include the opportunity for sustainable growth and 
job creation, it must also be ensured that no one is 
left  behind  and  all groups  in  society  benefit  from 
the transition. 

The Greek recovery and resilience plan (RRP) 
outlines crucial reforms and investments for 
a  fair  green  transition.  In  particular,  several 
projects  on  employment  support,  education  and 
skills  have  a  strong  green  dimension.  The  new 
strategy  for  lifelong  learning  includes  training 
programmes  on  green  skills,  targeted  hiring 
incentives  and  private  investments  in  climate-
friendly  business  activities  supported by  the Loan 
Facility to support quality job creation in the green 
economy.  The  Just  Transition  Fund  will  finance 
reskilling programmes, employment incentives and 
social  measures  in  the  three  territories  most 
affected  by  climate  transition,  and  the  European 
Social  Fund  Plus  (ESF+)  will  support  green  skills 
and  help  workers  adapt  to  change,  among  other 
measures.  An  energy  poverty  action  plan  outlines 
targeted  policy  measures 
for  economically-
vulnerable  households  and  measures  to  improve 
energy efficiency, as well as to promote the use of 
renewables in residential buildings. The integrated 
national  energy  and  climate  plan  for  Greece  of 
23 December  2019  sets  a  target  of  reducing 
energy  poverty  by  75%  by  2030,  compared  to 
2016  (when  it  affected  29.1%  of  the population). 
It  considers  the  social,  employment  and  skills 
impacts  of  a  transition  towards  a  carbon-neutral 
economy,  particularly 
lignite-dependent 
regions,  but  proposes  only  a  partial  set  of 
measures to address them. 

in  the 

nonetheless 

The  Greek  economy  has  reduced  its  carbon 
footprint,  which 
remains 
sizeable,  and  the  green  economy  provides 
strong potential for creating quality jobs. The 
greenhouse  gas  (GHG)  emissions  intensity  of  the 
Greek economy decreased by 12% between 2015 
and  2020  (in  terms  of  gross  value  added)  -  less 
than the EU average. It is now 20% above the EU 
average,  with  the  average  carbon  footprint  per 
worker at 16.13 tonnes of GHG emissions (against 
13.61  in  the  EU)  (see  Graph  A.6.1).  Coal,  lignite, 
and  fossil  fuel-based 
industries  have  been 
identified (40)  as  declining  sectors.  Especially  for 

lignite,  in  the  region  of  Western  Macedonia  (and 
notably in the Kozani prefecture where the largest 
mines and most power plants are located), lignite-
based electricity production is the most important 
economic  sector,  accounting  for  over  one  third  of 
regional GDP. This highlights the need to mitigate 
employment  and  social  impacts  with  appropriate 
accompanying measures (41) (42). Up- and reskilling 
are  particularly  important  here  (see  Annex  15). 
Energy-intensive  industries  provide  jobs  to  less 
than 1.2% of the total employed workforce, one of 
the lowest shares in the EU. The country does not 
have  data  on  the  environmental  goods  and 
services sector. Wind and solar energy potential as 
well  as  energy  efficiency  improvements  offer 
further  opportunities  for  green  jobs  (Eurofound, 
2021). 

Greece  faces  substantial  challenges  on  the 
social  dimension  of  the  green  transition, 
including  access  to  essential  transport  and 
energy  services,  and  energy  poverty  of  low-
income households. The share of the population 
in  rural  areas  at  risk  of  poverty  decreased  in  the 
last  5  years  but  remains  above  the  EU  average 
(22.4%  vs  18.7%) (43).  While  the  share  of  the 
population unable to keep their homes adequately 
warm decreased from 29.2% in 2015 to 17.1% in 
2020, it remains twice as high as the EU average 
(8.2%).  Lower-income  groups  are  affected  the 
most (see Graph A6.2), with the country being one 
of the worst performers in the EU for the poorest 
20% of the population. Patterns in energy use vary 
across  the  population  with  the  top  10%  of 
emitters  having  around  4.5  times  the  carbon 
footprint of the bottom 50% (5.3 times in the EU). 

Tax  systems  are  key  to  ensuring  a  fair 
transition  towards  climate  neutrality (44). 
Greece’  revenues  from  total  environmental  taxes 
were  stable  between  2015  (3.83%  of  GDP)  and 
2019 (3.87%) and stood at 3.77% of GDP in 2020 
(against  2.24%  in  the  EU).  The  labour  tax  wedge 

(41)  The country committed to the full closure of the lignite sector 

by 2028. 

(42)  2020 European Semester: Overview of Investment Guidance 
on the Just Transition Fund 2021-2027 per Member State 
(Annex D). 

(43)  As a proxy for potential transport challenges in the context of 

the green transition (see COM(2021) 568 final). 

(40)  SWD(2021) 275 final. 

(44)  COM(2021) 801 final. 

33 

 
 
                                                 
                                                 
 
low-income  earners (45)  was  also  stable 
for 
between  2015  and  2019  at  around  32%,  and 
decreased  to  29.9%  in  2021  when  it  averaged 
31.9%  in  the  EU  (see  Annex  18).  Redistributive 
measures  accompanying  environmental  taxation 
could  have  a  positive  impact,  notably  on  the 
disposable  income  of  households  in  the  bottom 
10% of the income distribution (46).  

Graph A6.1: Fair green transition challenges 

(1) Numbers are the normalized indicator performance, 
signifying factors relative to the EU27 average 
(2) Carbon inequality: average emissions per capita top 10% 
vs bottom 50% (2019) 
Source: Eurostat, world inequality database 

Graph A6.2: Energy poverty by income decile 

(1) HH050: ability to keep home adequately warm, HY020: 
total disposable household income 
Source: Eurostat EU-SILC survey (2020, 2019 for IT and DE) 

(45)  Tax wedge for a single earner at 50% of the national 

average wage. Source: Tax and benefits database, European 
Commission/OECD. 

(46)  SWD(2021) 641 final PART 3/3. 

34 

 
 
 
 
                                                 
PRODUCTIVITY 
PRODUCTIVITY 
ANNEX 7: RESOURCE EFFICIENCY AND PRODUCTIVITY 
ANNEX 7: RESOURCE EFFICIENCY AND PRODUCTIVITY 

48%).  A  significant  number  of  irregular  and 
substandard landfills continue to operate in Greece 
and  present  serious  risks  for  human  health  and 
the environment. Greece has adopted and notified 
the  Commission  of  its  updated  national  waste 
management  plan 
is  under 
assessment,  but  has  not  yet  notified  its  updated 
regional waste management plans.  

(ESDA),  which 

Graph A7.1: Economic importance and expansion of 
the circular economy - employment and value 
added in the circular economy sectors 

Source: European Commission 

while 

minimising 

The  efficient  use  of  resources  is  key  to 
ensuring  competitiveness  and open strategic 
autonomy, 
the 
environmental  impact.  The  green  transition 
presents  a  major  opportunity  for  European 
industry 
clean 
creating  markets 
technologies  and  products.  It  will  have  an  impact 
across  the  entire  value  chains  in  sectors  such  as 
energy and transport, construction and renovation, 
food  and  electronics,  helping  create  sustainable, 
local and well-paid jobs across Europe. 

for 

by 

Recycling  nearly  doubled 
in  2015-2020. 
During  this  period,  the  share  of  material  recycled 
to  the  overall  material  use  has  been  significantly 
increased  by  184%  In  2020,  about  5.4%  of 
material  resources  used  in  Greece  came  from 
recycled waste materials, which is only about half 
of  the  EU  average  rate.  However,  some  circular 
economy measures set out in the RRP should help 
the country close the gap. 

Resource  productivity  has  been  growing 
steadily 
is  an 
in  recent  years,  which 
encouraging  trend.  Purchasing  power  per 
kilogram  of  material 
increased 
significantly in 2015-2020, and current levels are 
just slightly below the EU average (2.14 vs 2.23). 

consumed 

A successful circular economy requires social 
and technological innovation across all value 
chains.  Eco-Innovation  is  therefore  an  important 
enabling  factor  for  the  circular  economy.  Product 
design  approaches  and  new  business  models  can 
help to produce 'circular' innovations, thus creating 
new  business  opportunities.  Greece  ranked  17th 
(with  a  score  of  102)  in  the  2021  EU  Eco-
Innovation Scoreboard, making it an 'average eco-
innovation  leader'.  Greece  scores  below  the  EU 
average on all five components of the 2021 Eco-
innovation index, namely eco-innovation activities, 
eco-innovation  outputs,  socio-economic,  eco-
innovation input and resource efficiency outcomes. 

After  a  downward  trend,  municipal  waste 
generation in Greece has started to increase 
in recent years, rising to 524 kg/year/inhabitant in 
2019,  although  it  remains  relatively  close  to  the 
EU  average  (502  kg/year/inhabitant).  It  indicates 
that  Greece’s  economic  growth 
is  not  yet 
decoupled  from  its  generation  of  waste.  Greece 
disposes  most  of  its  municipal  waste  in  landfills 
(78%), with only 21% being recycled (EU average 

35 

 
 
 
 
 
 
 
Table A7.1: Selected resource efficiency indicators 

Source: Eurostat 

36 

 
 
 
 
ANNEX 8: DIGITAL TRANSITION 
ANNEX 8: DIGITAL TRANSITION 

The Digital Economy and Society Index (DESI) 
monitors EU Member States’ digital progress. 
The  areas  of  human  capital,  digital  connectivity, 
the 
technologies  by 
businesses  and  digital  public  services  reflect  the 
Digital  Decade’s  four  cardinal  points (47).  This 
Annex describes Greece’s DESI performance.  

integration  of  digital 

The Greek recovery and resilience plan (RRP) 
dedicates more than 23% of its allocation to 
measures supporting the digital transition, in 
particular  boosting  connectivity,  improving 
the  digitalisation  of  public  services  and 
promoting the digitisation of businesses. 

Stepping  up  efforts  to  develop  digital  skills 
remains  a  priority  for  Greece.  Just  over  half 
the population has at least basic digital skills, very 
close  to  the  EU  average.  The  share  of  ICT 
specialists 
low 
compared to the EU average, but the proportion of 
women  among  ICT  specialists  is  above  the  EU 
average. 

in  employment  remains  very 

In  the  area  of  connectivity,  Fixed  Very  High 
Capacity  Networks  (VHCN)  coverage  doubled 
in  one  year  and  5G  coverage  has  developed 
very  fast.  Despite  progress  made,  in  2021,  the 
percentage of households covered with VHCN was 
low  compared to the  EU  average.  By  contrast,  5G 
coverage had reached the EU average and Greece 
scored  very  high  (99%)  in  the  5G  readiness 
indicator in 2021/22 (EU average 56%).  

technologies  are 

Digital 
slowly  being 
integrated into business activities. Four out of 
10 SMEs have a basic level of digital intensity. On 
the  adoption  of  advanced  digital  technologies, 
enterprises in Greece are almost at the EU average 
for  the  adoption  of  big  data,  though  they  are 
below  the  EU  average  for  cloud  and  artificial 
intelligence. 

is 

Greece 
in  the  process  of  digitally 
transforming  its  public  services  and  has 
made  substantial  progress  with  on-line 
public services. However, the results are not yet 
reflected in the indicators on digital public services 
for  businesses  and  the  general  public,  which 
remain far below the EU average, mainly because 
of the lack of cross-border services. 

(47)  2030 Digital Compass: the European Way for the Digital 

Decade Communication, COM (2021) 118 final 

37 

 
 
                                                 
 
Table A8.1: Key Digital Economy and Society Index Indicators 

Note: 'In the area of connectivity, Fixed Very High Capacity Networks (VHCN) coverage doubled in one year and 5G coverage has 
developed very fast. In 2021, the percentage of households covered with VHCN (including fibre to the premises), despite the 
progress remains low compared to the EU average. But the 5G coverage, in only one year, reached the EU average. It is to be 
noted that, Greece also scores very high (99%) in the 5G readiness indicator in 2021/22 (EU average 56%). 
(*) The 5G coverage indicator does not measure users’ experience, which may be affected by a variety of factors such as the type 
of device used, environmental conditions, number of concurrent users and network capacity. 5G coverage refers to the percentage 
of populated areas as reported by operators and national regulatory authorities. 
Source: Digital Economy and Society Index 

38 

 
 
 
 
ANNEX 9: INNOVATION 
ANNEX 9: INNOVATION 

This  Annex  provides  a  general  overview  of 
the  performance  of  Greece’s  research  and 
innovation (R&I) system.  

productive  sector  and  is  not  used  productively,  as 
demonstrated  by  the  relatively  low  number  of 
patents (0.6 patent applications per billion GDP vs 
an EU average of 3.5). 

In  the  2021  edition  of  the  European 
Innovation  Scoreboard (48)  Greece 
is  a 
moderate  innovation  performer  and  faces 
challenges  in  reducing  its  gap  with  the  EU 
innovation  leaders.  The country's total  research 
and  development  (R&D)  intensity  reached  1.50% 
in  2020,  which  is  still  well  below  the  EU  average 
of 2.32%.  

improved 

its 
investment 

commitment 
research 
in 

its  R&I 
Greece  has  gradually 
to 
performance,  and 
increasing 
is 
encouraging.  Greece  has  steadily  increased  its 
R&D investment in the last decade (from 0.60% in 
2010 to 1.50% in 2020), although it still continues 
to  lag  behind  the  EU  average.  Notably,  public 
expenditure on R&D as percentage of GDP reached 
EU  average  levels  in  2020.  The  increase  in  R&D 
investment  has  contributed  to  the  increase  of 
high-technology  exports  as  a  percentage  of  total 
manufacturing  exports,  from  8.5%  in  2013  to 
13.2% in 2020. Despite this progress, the still low 
intensity  of  R&D  weighs  on  Greece’s  growth 
in  the 
potential  and  calls  for 
effectiveness  of  related  investments  to  raise 
innovation  performance  and  ensure  sustainable 
growth.  To  tackle  these  key  challenges,  Greece's 
RRP includes targeted reforms and investments to 
increase public and private R&D spending, upgrade 
the country’s research infrastructures, increase the 
internationalisation  of 
research 
ecosystem, and develop research collaborations. 

improvements 

the  Greek 

The  links  between  Greek  academia  and  the 
productive  sector  remain  weak.  The  low  level 
of  business  enterprise  expenditure  on  R&D  as  a 
percentage  of  GDP  (0.69%  vs  an  EU  average  of 
1.52%) affects the capacity to strengthen stronger 
business-science  links.  Greece  registers  low  total 
public  sector  support  for  business  enterprise 
expenditure  on  R&D  (0.064%  of  GDP  in  2017  vs 
an EU average of 0.196%) and public expenditure 
on  R&D  financed  by  business  enterprise  has 
remained rather stagnant and scores below the EU 
average  (0.041%  of  GDP  in  2020  vs  0.054%). 
While Greek universities perform well on research 
is  not  oriented  to  support  the 
output,  this 

(48)  2021 European Innovation Scoreboard, Country profile: 

Greece. https://ec.europa.eu/docsroom/documents/45916 

39 

 
 
                                                 
 
Table A9.1: Key research, development and innovation indicators 

Source: European Innovation Scoreboard: https://ec.europa.eu/docsroom/documents/45916  

40 

 
 
 
 
ANNEX 10: INDUSTRY AND SINGLE MARKET 
ANNEX 10: INDUSTRY AND SINGLE MARKET 

prosperity,  well-being 

Productivity  growth  is  a  critical  driver  of 
and 
economic 
convergence over the long run. A major source 
of  productivity  for  the  EU  economy  is  a  well-
functioning single market, where fair and effective 
competition  and  a  business  friendly  environment 
are  ensured, 
in  which  small  and  medium 
enterprises  (SMEs)  can  operate  and  innovate 
without  difficulty.  Businesses  and  industry  rely 
heavily  on  robust  supply  chains  and  are  facing 
bottlenecks that bear a negative impact on firms’ 
productivity 
levels,  employment,  turnover  and 
entry/exit  rates.  This  may  impact  the  Member 
States’  capacity  to  deliver  on  Europe’s  green  and 
digital transformation. 

procurement  services,  will  be  implemented  under 
the RRP. 

On single market integration and compliance, 
Greece’s performance in terms of the number 
of EU directives transposed into national law 
is  above  the  EU  average,  but  transposition 
timelines  vary.  Greece  is  among  the  Members 
States  with  the  highest  number  of  infringement 
cases.  Problematic  sectors  include  environment, 
transport 
The 
professional  services  regulatory  restrictiveness 
remains high compared to the EU average.   

and  waste  management. 

level 

labour 

productivity 

is 
Greece's 
increasing, but is still lower than the rest of 
the  EU.  After  a  considerable  drop  following  the 
financial  crisis, 
labour  productivity  has  been 
increasing  in Greece,  from  98.7  in  2018  to  105.4 
points  in  2020  but  is  still  lower  than  the  EU 
average (108.6 points in 2020) (49). 

Access to finance remains difficult for many 
companies  in  Greece.  Both  loans  and  equity 
capital  is  lower  than  the  EU  average,  and  the 
percentage of SMEs whose banks loan applications 
were rejected is almost the double the EU average. 
In  the  last  2  years,  equity  seems  becoming  a 
bigger  source  of  funding  as  the  number  of  Greek 
SMEs that used equity capital in the last 6 months 
increased  by  2.4%.  The  Loan  Facility  and  related 
reforms  under  the  recovery  and  resilience  plan 
(RRP)  will  be  instrumental.  Late  payments  is 
another  major  difficulty  for  many  firms  (26%). 
Despite  recent  progress,  the  share  of  SMEs 
experiencing late payments in the last 6 months is 
higher than the EU average (54.9% vs 45%). 

increased 

slightly.  A 

In public procurement, the percentage of bids 
from  SMEs  has  increased  considerably  and 
the percentage of contractors that are SMEs 
public 
has 
procurement law was adopted in March 2021, and 
complemented  in  May  2021  by  an  action  plan  to 
implement  a  new  national  strategy  for  2021-
2025.  Two  of  the  action  plan's  measures  -  the 
digital 
transformation  of  public  procurement 
processes  and  the  professionalisation  of  public 

new 

(49)https://ec.europa.eu/eurostat/databrowser/view/nama_10_lp_

ulc/default/table?lang=en 

41 

 
 
                                                 
 
 
 
Table A10.1: Key Single Market and Industry Indicators 

Source: See above in the table the respective source for each indicator in the column “description”. 

42 

 
 
 
 
ANNEX 11: PUBLIC ADMINISTRATION 
ANNEX 11: PUBLIC ADMINISTRATION 

capacity 

administrative 

Good 
enables 
economic  prosperity,  social  progress  and 
fairness. Public administrations at all government 
levels deliver crisis response, ensure the provision 
of  public  services  and  contribute  to  building 
resilience  for  the  sustainable  development  of  the 
EU economy.  

but 

years, 

evaluations 

Overall,  despite  some  progress  achieved  in 
recent 
administration 
public 
performance  in  Greece  is  relatively  low (50). 
Although the ability of the government to plan and 
coordinate  policymaking  has  improved,  it  remains 
below  the  EU  average.  An  impact  assessment  is 
required  for  every  new  draft  law  submitted  to 
Parliament, 
actual 
implementation are not systematically carried out. 
While draft laws are systematically uploaded on a 
government  platform,  the  consultation  period  is 
brief  and  usually  inconsequential  (Graph  A11.1). 
The Greek recovery and resilience plan (RRP) aims 
to  strengthen  institutional  resilience,  for  example 
responsibilities  between  public 
through  clear 
administration 
planning  and 
levels.  Policy 
impact  assessment  will  also  be 
regulatory 
reinforced.  

on 

The 

share  of 

capacity 
civil 

faces 
Greece’s  administrative 
challenges. 
servants 
participating  in  adult  learning  and  the  share  of 
public  administration  employees  with  tertiary 
education are both below the EU average. The RRP 
aims  to  build  capacity  and  to  upskill  a  significant 
proportion  of  civil  servants,  while  modernising 
hiring  procedures  and  reward  systems  for  civil 
servants to increase motivation and effectiveness.  

Graph A11.2: Performance on the single market 
public procurement indicator 

Source: Single market scoreboard 2020 data 

Public  financial  management  can  be  further 
improved.  Despite  a  steady 
improvement, 
Greece’s  performance 
in  public  procurement 
remains relatively low. This is due to inefficiencies 
in transparency, competition, efficiency and quality 
of  information  (Graph  A11.2).  In  addition,  the 
mandate of Greece's independent fiscal institution 
is  narrower  than  that  of  other  EU  countries.  The 
RRP  will  invest  in  digital  tools  to  support  public 
financial  management, 
including  procurement, 
enterprise  resource  planning,  payment  execution 
and  the  implementation  of  public  investment 
projects. 
state-owned-
enterprises will be strengthened.  

The  governance  of 

justice  system  continues 

to  face 
The 
efficiency  and  quality  challenges.  The  time 
needed  to  resolve  litigious  civil  disputes  in  first 
instance  has  continued  to  increase  (637  days  in 
2019 vs 559 days in 2018) (no data are available 
for  2020).  Meanwhile,  e-justice  can  be  further 
developed.  On  judicial  independence,  no  systemic 
deficiencies have been reported (51). 

Graph A11.1: Performance on evidence-based 
policy making indicators 

(1) RIA: Regulatory Impact Assessment  
Source: OECD (iREG indicators) 

(50)  Worldwide Governance Indicators, 2020. 

(51)  For a more detailed analysis of the performance of the 
justice system in Greece, see the 2022 EU Justice 
Scoreboard (forthcoming) and the country chapter for Greece 
in the Commission’s 2022 Rule of Law Report (forthcoming). 

43 

 
 
 
 
                                                 
 
                                                 
 
Table A11.1: Public administration indicators – Greece 

(1) High values stand for good performance barring indicators # 7 and 8. 
(2) Measures the user centricity (including for cross-border services) and transparency of digital public services as well as the 
existence of key enablers for the provision of those services. 
(3) Break in the series in 2021. 
(4) Defined as the absolute value of the difference between the share of men and women in senior civil service positions.  
Source:  ICT use survey, Eurostat (# 1); E-government benchmark report (# 2); Open data maturity report (# 3); Fiscal governance 
database (# 4, 9, 10); Labour Force Survey, Eurostat (# 5, 6, 8), European Institute for Gender Equality (# 7), Single Market 
Scoreboard public procurement composite indicator (# 11); OECD indicators for regulatory policy and governance (# 12). 

44 

 
 
 
 
FAIRNESS 
FAIRNESS 
ANNEX 12: EMPLOYMENT, SKILLS AND SOCIAL POLICY CHALLENGES IN LIGHT OF 
ANNEX 12: EMPLOYMENT, SKILLS AND SOCIAL POLICY CHALLENGES IN LIGHT OF 
THE EUROPEAN PILLAR OF SOCIAL RIGHTS  
THE EUROPEAN PILLAR OF SOCIAL RIGHTS  

The European Pillar of Social Rights provides 
for  upward  convergence 
the  compass 
towards better working and living conditions 
in the EU. The implementation of its 20 principles 
on  equal  opportunities  and  access  to  the  labour 
market,  fair  working  conditions,  social  protection 
and inclusion, supported by the 2030 EU headline 
targets  on  employment,  skills  and  poverty 
reduction, will strengthen the EU’s drive towards a 
digital,  green  and  fair  transition.  This  Annex 
provides  an  overview  of  Greece’s  progress  in 
achieving  the  goals  under  the  European  Pillar  of 
Social Rights. 

Table A12.1: Social scoreboard for Greece 

Source: European Commission 

While  the  labour  market  has  weathered  the 
COVID-19  crisis  well,  strengthening  the 
effectiveness  of  active 
labour  market 
policies remains key to support employment, 
in  particular  of  women,  young  people  and 
vulnerable  groups,  such  as  people  with  a 
migrant background. After rising in the wake of 
the  COVID-19  pandemic,  the  unemployment  rate 

resumed  its  downward  trend  and  reached  14.7% 
in 2021, the lowest level since 2010. Young people 
have been hit hard by the COVID-19 crisis and the 
share  of  those  not  in  employment,  education  or 
training  (NEET)  has  just  returned  to  its  pre-
pandemic  level.  The  NEET  rate  in  the  age  group 
25-29 (28.7% in 2020) is much higher than in the 
15-24 age group (11% in 2021). The employment 
rate  is  increasing  but  still  remains  among  the 
lowest  in  the  EU  for  both  men  and  women. 
Moreover,  the  gender  employment  gap  of  almost 
20  pps  poses  a  critical  challenge.  The  disability 
employment gap is slightly above the EU average 
(27.7 pps  vs  24.5 pps).  The  participation  of 
children  under  the  age  of  3  in  formal  early 
childhood  education  and  care  fell  from  40.9%  in 
2018  to  21.5%  in  2020  (vs  32.3%  in  the  EU), 
possibly  also due to the COVID  19 pandemic. The 
recovery and resilience plan (RRP) will support the 
creation of new childcare facilities in municipalities 
and  in  large  companies.  Greece  has  strengthened 
its  hiring  subsidy  scheme  for  private  sector 
employment,  and  the  European  Social  Fund  Plus 
(ESF+)  will  provide  significant  funding  for  active 
labour  market 
public 
employment  services  and  providing  tailor-made 
support  to  jobseekers  will  be  key  to  ensure  the 
effectiveness  of  these  measures  and  to  help 
Greece  achieve  the  2030  EU  headline  target  on 
employment.  

Enhancing 

policies. 

is  a 

top  performer 

While  Greece 
in 
preventing early school leaving, its education 
system  faces  challenges.  Greece  managed  to 
reduce  the  share  of  early  leavers  from  education 
and training from 13.5% in 2010 to 3.2% in 2021. 
However, for the non-EU born, early school leaving 
(30% in 2021) is a considerable challenge. The low 
achievement  rate  among  15  year-old  students  is 
high  (around  one  third)  and  the 
impact  of 
students’  socio-economic  background  on  school 
performance is among the strongest in the EU (see 
Annex  13).  In  this  respect,  the  ESF+  will  provide 
important support for inclusive education.  

Skills  have  yet  to  catch  up  with  labour 
market needs. Greece is one of few EU Member 
States  where  the  employment  rate  of  recent 
graduates  is  lower  than  the  overall  employment 
rate,  suggesting  difficulties 
in  school-to-work 
transitions. Skills mismatches are pronounced and, 
while  many  tertiary  graduates  end  up  being 

45 

 
 
 
 
 
 
 
 
overqualified  for  their  jobs,  vocational  education 
and  training  remains  an  unattractive  option  for 
upper-secondary  students.  The  proportion  of 
adults aged 25-64 who participated in learning in 
the  past  4  weeks  is  far  below  the  EU  average 
(3.5% vs 10.8% in 2020). A considerable share of 
adults state that they lack technical skills (47% vs 
an  EU  average  of  28%)  or  general  skills (38%  vs 
22%)  to  perform  their  work  at  the  required  level. 
The share of individuals with at least basic digital 
skills increased from 46% in 2017 to 52% in 2021 
(EU  average:  54%).  The  reform  of  the  adult 
learning  system  planned  in  the  RRP  and  the 
accompanying 
to 
improve the  quality  and  take-up  of  upskilling  and 
reskilling 
adult 
learning is key if Greece is to achieve the 2030 EU 
headline target on skills. 

investments  are  expected 

Strengthening 

programmes. 

the  adequacy  of 

Risk of poverty in Greece remains among the 
highest in the EU but is declining. The share of 
people  at  risk  of  poverty  or  social  exclusion 
decreased  from  32.2%  to  27.4%  between  2017 
and  2021  as  a  result  of  the  economic  recovery 
and  social  welfare  reforms.  The  share  is  higher, 
though, among children (30.8% in 2021), and the 
share  of  children  with  severe  material  and  social 
deprivation (19.6% in 2020) is among the highest 
in  the  EU.  The  poverty  reducing  impact  of  social 
transfers  (other  than  pensions)  has  improved. 
However, 
the  guaranteed 
minimum  income  scheme  is  lower  than  in  most 
other  EU  Member  States  and  gaps  persist  in 
access to social protection for non-standard forms 
of employment in general and self-employment in 
particular  (respectively  44%  and  29%  of  the 
working-age  population  in  2020).  Self-reported 
unmet  needs  for  medical  care  have  been 
decreasing, but affordability of healthcare remains 
critical,  with  out-of-pocket  payments  accounting 
for  35%  of  total  healthcare  expenditure.  Public 
expenditure  on  long-term  care  is  significantly 
below  the  EU  average  (0.2%  vs  1.7%  of  GDP  in 
2019),  and  there is  no  comprehensive strategy  in 
place.  The  share  of  the  population  affected  by 
excessive  housing  costs  continues  to  be  among 
the highest in the EU, despite a decrease of 7 pps 
between  2018  and  2020.  Strengthened  social 
policy action is needed if Greece is to achieve the 
2030 EU headline target on poverty reduction. The 
ESF+  will  provide  substantial 
for 
combating  child  poverty  and  further  improving 
access to social and healthcare services.  

funding 

46 

 
ANNEX 13: EDUCATION AND SKILLS 
ANNEX 13: EDUCATION AND SKILLS 

This  Annex  outlines  the  main  challenges  for 
Greece's  education  and  training  system  in 
light of the EU-level targets of the European 
Education  Area  strategic  framework  and 
other  contextual  indicators,  based  on  the 
analysis  from  the  2021  Education  and  Training 
Monitor 

is 

system 

education 

highly 
Greece’s 
centralised.  It  lags  behind  the  EU  average 
and fails to meet EU targets on participation 
in early childhood education (in particular for 
children  under  the  age  of  4),  basic  skills,  and 
public  expenditure  on  education 
(particularly 
tertiary education).  

linked 

Greece  ranks  last  in  the  EU  on  participation 
in  early  childhood  education  and  care  (age 
3+)  with  major  challenges 
to 
affordability  and  quality.  Greece  has  much 
higher  participation  rates  for  the  4+  age  bracket 
than 
the  3+.  Mandatory  pre-primary 
attendance  was  extended  to  include  4  year-olds, 
but  implementation  is  difficult  due  to  capacity 
constraints.  An 
integrated  policy  approach 
(covering  the  continuum  from  0-6  years)  could 
lead to progress.  

for 

Graph A13.1: Low achievement in reading by 
socioeconomic status, PISA 2018 

Underachievement  in  basic  skills  remains 
high  with  considerable  disparities  by  socio-
economic  and  migrant  status.  Greece  has  the 
highest  shares  of  low  achievers  in  the  EU  in  all 
three PISA tests. Almost half of the students from 
the lowest socio-economic quartile lack basic skills 
in  reading  compared  to  almost  1  in  7  in  the 
highest  quartile  (figure  A13.1).  Similarly,  about 
half  of  students  with  a  migrant  background  are 
low achievers compared to 1 in 3 students without 
a  migrant  background.  The  performance  gap 
between  public  and  private  schools  is  among  the 
highest  in  the  EU,  corresponding  approximatively 
to 2 years of schooling.  

to 

develop 

opportunities 

Teachers  in  Greece  are  highly  educated  but 
their 
lack 
pedagogical  competences.  Education  is  valued 
highly  in  Greece,  but  it  translates  poorly  into 
teacher  education.  Steps  are  being  taken  to 
improve  the  quality  of  school  education  by 
providing  teachers  with  some  autonomy  and 
appraising  performance.  Regularising  the  large 
temporary  teacher  workforce  with  contracts  that 
reward performance and provide career prospects, 
would 
teaching 
quality (52). 
constitute  an  ageing 
workforce  in  Greece,  with  more  than  half  the 
Greek  teachers  being  set  to  retire  within  this 
decade.  

teachers’  morale  and 

Teachers 

raise 

Regional  disparities  in  tertiary  education 
attainment  persist  with  a  considerable 
urban-rural gap. The rate of people aged 25-34 
with  a  tertiary  degree  is  above  the  EU  average. 
However,  access  of  migrant  children  to  post-
secondary  and  tertiary  education  remains  a 
challenge  for  the  country  as  the  integration  of 
recently arrived migrants into education has so far 
The 
primarily 
internationalisation  of 
country’s  higher 
education institutions needs particular action.  

on 
the 

schools. 

focused 

(1) The EU average does not include ES 
Source: OECD (2019), PISA 2018 

Greece recorded the largest drop in the share 
of early leavers from education and training 
in  the  last  decade,  and  now  has  one  of  the 
lowest  rates  in  the  EU.  Early  school  leaving  is 
higher  in  rural  areas  (4.1%),  but  still  well  below 
the EU target of less than 9%.  

Public  spending  on  education  remains  low. 
General  government  spending  on  education 
in 2019 remained below the EU average, both 
as a proportion of GDP (4.0% vs 4.7%) and of total 
general  government  spending  (8.3% vs  10%),  the 
latter  being  the  second  lowest  in  the  EU.  In 
contrast,  private  spending  on  education  is  high. 
Tertiary  education  is  considerably  underfunded. 
This  situation  may  improve,  partly  thanks  to  new 

(52)  OECD (2020), OECD Economic Surveys: Greece 2020, OECD 
Publishing, Paris. https://doi.org/10.1787/4751e985-en 

47 

 
 
                                                 
 
 
in  January  2020 (53)  that 
legislation  adopted 
introduces  performance-based  funding  in  higher 
education based on objective criteria, starting from 
the 2021/2022 academic year.  

implementation  of  Greece’s 
An  effective 
national  recovery  and  resilience  plan  could 
help  address  several  of  these  longstanding 
challenges. Key measures focus on improving 
the  education  system,  improving  skills,  the 
digitalisation  of  education,  excellence  in  Greek 
universities,  upgrading  vocational  education  and 
training (VET), and supplying laboratory equipment 
to VET educational units.  

Table A13.1: EU-level targets and other contextual indicators under the European Education Area 
strategic framework 

(1) The 2018 EU average on PISA reading performance does not include ES 
(2) d = definition differs, u = low reliability, : = not available  
(3) Data are not yet available for the remaining EU-level targets under the European Education Area strategic framework, 
covering underachievement in digital skills, exposure of vocational education and training graduates to work-based learning and 
participation of adults in learning. 
Source: Eurostat (UOE, LFS), OECD (PISA) 

(53)  Law 4653/2020. 

48 

 
 
                                                 
 
 
 
Graph A14.2: Projected increase in public 
expenditure on health care over 2019-2070 (AWG 
reference scenario) 

Source: European Commission/EPC (2021) 

Greece  has  the  highest  number  of  doctors 
per  capita  in  the  EU,  but  the  lowest  number  of 
nurses.  The  vast  majority  of  doctors  are 
specialists.  General  practitioners  (GPs)  make  up 
only  7%  of  doctors  (EU:  26%).  Ensuring  an 
adequate GP supply remains a major challenge in 
strengthening 
High 
consumption  of  antibiotics  raises  public  health 
concerns over antimicrobial resistance. 

healthcare. 

primary 

Through  its  recovery  and  resilience  plan, 
Greece  plans  to  invest  EUR 1.48  billion  in 
healthcare  (4.8%  of  the  total).  A  broad  range 
of  reforms  and  investments  are  envisaged  for 
strengthening  many  parts  of  the  health  system: 
public  hospitals,  primary  care,  mental  health  and 
reimbursement  of 
addictions,  public  health, 
pharmaceuticals and community-based care. Many 
investments concern capital  asset formation (new 
or 
refurbished  energy-efficient  facilities,  and 
acquisition  of  medical  equipment)  and  a  sizeable 
share  of  investments  will  go  towards  the  digital 
transformation of the health system. 

ANNEX 14: HEALTH AND HEALTH SYSTEMS 
ANNEX 14: HEALTH AND HEALTH SYSTEMS 

Especially  relevant  in  light  of  the  ongoing 
COVID-19 pandemic, resilient healthcare is a 
prerequisite  for  a  sustainable  economy  and 
society.  This  Annex  provides  a  snapshot  of  the 
healthcare sector in Greece.  

Life  expectancy  in  Greece  is  above  the  EU 
average,  although  it  fell  by  more  than  3 
months in 2020 due to COVID-19. By 17 April 
2022, 2.67 cumulative COVID-19 deaths and 303 
confirmed  cumulative  COVID-19  cases  per  1 000 
inhabitants were reported. Treatable mortality was 
93.1 per 100 000 population in 2019 (EU average 
in  2017:  92.1).  Premature  deaths  from  ischaemic 
heart  disease  and  cerebrovascular  disorders 
(including  stroke)  accounted  for  36%  of  treatable 
mortality. 

Graph A14.1: life expectancy at birth, years 

Source: Eurostat database 

Health  spending  relative  to  GDP  in  Greece 
was  below  the  EU  average  in  2019.  Spending 
per  capita  is  around  half  the  EU  average,  but 
spending  on  pharmaceuticals  and  inpatients  is 
relatively  high.  Since  2015,  spending  increases 
have  been  small  but  steady.  The  COVID-19 
pandemic  prompted  additional  funding  injections 
in  2020  to  support  the  health  sector.  Public 
spending on health is projected to increase by 0.8 
percentage points (pps) of GDP by 2070 (vs 0.9 pp 
for the EU) (54).  

(54)  ‘The 2021 Ageing Report: Economic and Budgetary 

Projections for the EU Member States (2019-2070)’, 
European Commission (ECFIN) and Ageing Working Group 
(EPC). 

49 

 
 
 
                                                 
 
 
Table A14.1: List of key indicators, health 

(1) Doctor density data refer to practising doctors in all countries except for FI, EL, PT (licensed to practise) and SK (professionally 
active). Nurse density data refer to practising nurses (imputation from year 2014 for FI) except for IE, FR, PT, SK (professionally 
active) and EL (nurses working in hospitals only). More information: https://ec.europa.eu/health/state-health-eu/country-health-
profiles_en 
Source: Eurostat, except: * Eurostat Database and OECD, ** ECDC.  

50 

 
 
 
 
 
 
 
 
 
ANNEX 15: ECONOMIC AND SOCIAL PERFORMANCE AT REGIONAL LEVEL 
ANNEX 15: ECONOMIC AND SOCIAL PERFORMANCE AT REGIONAL LEVEL 

of 

Multiple  factors  affect  development  in  the 
Greek  regions,  including:  low  connectivity 
between and within  regions  and  limited  roll-
out 
specialisation 
strategies. In three regions, less than 25% of the 
population 
degree,  while 
employment  in  high-technology  sectors  and  R&D 
expenditure are particularly low. 

regional 

tertiary 

smart 

has 

a 

Greece  has  the  16th  highest  fossil  CO2 
emission  intensity  per  person  in  the  EU. 
Greek  regions  affected  by  the  climate 
transition  include  West  Macedonia,  South 
Aegean  and  North  Aegean,  including  specific 
carbon-intensive areas in Peloponnese region 
(Megalopoli,  Tripoli,  Gortynia  and  Oichalia). 
Concrete plans on social and regional development 
for the affected areas and communities are being 
rolled  out,  namely  the  relevant  Territorial  Just 
Transition  plans.  They  will  include  upskilling  and 
reskilling  programmes  for  affected  workers  and 
measures  to  address  the  social  consequences  of 
the transition. 

Graph A15.2: Territories most affected by the 
climate transition in Greece 

Note: For the Peloponnese region, the eligible areas are in 
Arkadia: the municipalities of Megalopoli, Tripoli, and Gortynia; 
and in Messinia: Oichalia. 
Source: European Commission 

is  an 

The  regional  dimension 
important 
factor  when  assessing  economic  and  social 
developments  in    Member  States.  Taking  into 
account  this  dimension  enables  a  well-calibrated 
and targeted policy response that fosters cohesion 
and  ensures  sustainable  and  resilient  economic 
development 
Regional 
disparities  remain  significant  in  Greece  with  a 
noticeable difference between the capital  and the 
southern  regions  on  the  one  hand,  and  the 
northern regions on the other hand. 

regions. 

across 

all 

All  Greek  regions  remain  below  75%  of  the 
EU average in terms of GDP per capita. Greek 
regions have been catching up with the rest of the 
EU since the economic crisis, but GDP per head is 
still below 50% of the EU average in four regions, 
while it reaches 91% in the capital region (Attica). 
Average  growth  in  GDP  per  person  was  negative 
for  all  regions  in  2010-2019  and  below  the 
national  average  in  a  number  of  less  developed 
regions. As a result, internal convergence in Greece 
did  not  advance.  While  unemployment  rates  are 
more than double than the EU average, there is a 
10.2  pp  difference  between  the  unemployment in 
the  best  (Peloponnese)  and 
least  performing 
region (Western Greece). As half of the population 
and  two  thirds  of  the  economy is  concentrated in 
the  capital  region,  significant  regional  disparities 
persist. 

Graph A15.1: CO2 emissions from fossil fuels per 
head, 2018 (Greece) 

Source: European Commission 

In  2018,  productivity  in  Greece  was  below 
the EU average (at 71%). At the regional level, 
it  ranges  between  89%  of  the  EU  average  in  the 
in  East 
region  of  Attica  and  53% 
capital 
Macedonia,  Thrace,  while  a  further  three  regions 
remain below 60%.  

51 

 
 
 
 
 
 
Graph A15.3: Regional performance groups (2021) 

South  Aegean  and  the  Ionian  Islands  (where  the 
tourism  sector  employs  66%  and  48%  of  the 
active population, respectively). Regions also differ 
significantly  in  terms  of  excess  mortality  due  to 
COVID-19,  with  higher  rates  recorded  in  East 
Macedonia,  Thrace,  Central  Macedonia,  West 
Macedonia  (more  than  10%),  while  in  South 
Aegean and Crete it was less than 3%. 

Source: European Commission 

country 

relatively 

low 
shows  a 
The 
innovation  performance.  Most  of  the  regions 
are  emerging  innovators, while  Attica (99.75)  and 
Crete  (94.25)  are  closer  to  the  EU  average  (100). 
ICT uptake is also below the EU average. In 2020, 
53%  of  the  population  used  the internet  for their 
interactions  with  public  authorities  (vs  an  EU 
average of 56%).  

Greek  regions  face  significant  challenges  on 
access  to  health  services.  With  a  national 
average of 6.4% (EU: 1.8%), a significant 10% of 
citizens in East Macedonia, Thrace report foregoing 
medical  consultations  due  to  high  costs,  long 
travelling distances or waiting lists. 

The  unemployment  rate  is  higher  in  the  less 
developed 
regions  of  Western  Greece 
(21.6%)  and  West  Macedonia  (19.7%).  There 
are  clear  social  disparities  across  regions,  with 
Western Greece also having a high share of people 
at  risk  of  poverty  or  social  exclusion  (42.4%). 
Between  2011  and  2019,  the  population  in  the 
capital  region  of  Attica  shrunk  by  6.4%,  while 
negative  trends  are  observed  in  another  nine 
regions.  Net  migration  is  negative  in  six  NUTS2 
regions, while it increased by 17.2% in the insular 
region of North Aegean.  

All  regions  in  Greece  were  affected  by  the 
COVID-19  pandemic,  though  to  a  varying 
degree.  A  high  proportion  of  microenterprises,  a 
low level of digital skills and strong dependency on 
tourism rendered regional economies vulnerable to 
the  socio-economic  consequences  of  COVID-19. 
The  region  of  Crete  faced  the  highest  increase  in 
unemployment  rates  in  2020  (+5.6  pp  compared 
with  2019),  while  COVID-19's  impact  on  tourism 
has  been  translated  to  higher  unemployment  in 

52 

 
 
 
Table A15.1: Selected indicators at regional level – Greece 

Source: Eurostat 

53 

 
 
 
 
MACROECONOMIC STABILITY 
MACROECONOMIC STABILITY 
ANNEX 16: KEY FINANCIAL SECTOR DEVELOPMENTS 
ANNEX 16: KEY FINANCIAL SECTOR DEVELOPMENTS 

impact  of 

positive,  albeit 
the 
low.  The 
securitisations  on  banks’  capital  positions  was 
partly  offset  by  successful  capital  enhancing 
actions  in  2021,  but  their  total  capital  ratio 
remains one of the lowest in the EU. Moreover, its 
quality remains weak, due to the increasing share 
of  deferred  tax  credits  in  the  banks’  supervisory 
capital.  Overall,  the  banks’  link  to  the  Greek 
sovereign,  through  various  channels,  has  been 
further  strengthened  partly  as  a  result  of  the 
response  to  the  pandemic  crisis,  as  was  the  case 
in  other  Member  States.  Meanwhile,  systemic 
banks  have  comfortable  liquidity  coverage  ratios, 
on  the  back  of  strong  deposit  growth  and 
abundant  central  bank  liquidity  (16.8%  of  total 
liabilities in Q3-2021).  

Private  debt  rose  sharply  in  2020  and  may 
burden  the  economic  recovery.  Although  its 
cost  of  servicing  remains  so  far  at  lower  levels 
than in the recent past, it may represent a burden 
to  economic  recovery  going  forward.  Moreover,  a 
large amount of non-performing private debt that 
has  exited  the  banks’  balance  sheets  remains  in 
the  economy,  in  the  hands  of  servicers.  The  new 
insolvency  framework  is  expected  to  help  banks 
long-term 
offer 
and 
restructuring  solutions  to  distressed  companies 
and,  where this  is  not  feasible,  facilitate  firm  exit 
and  entry  through  simplified  procedures  and 
appropriate  debt  discharge  periods  that  do  not 

servicers 

viable 

to 

This  Annex  provides  an  overview  of  key 
developments  in  Greece's  financial  sector. 
Greece  has  a  predominantly  bank-based  financial 
sector, characterised by a very high concentration 
rate and very low foreign ownership. The loan-to-
deposit  ratio  has  continued  to  decrease  in  recent 
years  and  it  has  remained  well  below  the  EU 
average,  reflecting  the  gradual  return  of  deposits 
since  2016,  coupled  with  overall  muted  lending 
activity over this period, especially for households, 
while the extensive non-performing securitisations 
and sales have led to a further sharp drop over the 
last 2 years.  

Banks  have  reduced  legacy  non-performing 
loans  but  the  outlook  remains  challenging. 
The  banking  sector  significantly  reduced  its  stock 
of  non-performing  loans in  2021  to  12%  of  total 
loans compared to 26.4% a year earlier through a 
series  of  securitisations  of  unprecedented  size 
under the Hercules scheme. Vulnerabilities for the 
banking  sector  remain  as  net  inflows  of  non-
performing loans continue, albeit at a limited rate. 
The securitisations under the Hercules scheme will 
allow  banks  to  reduce  their  cost-of-risk  going 
forward and free up space in their balance sheets 
lending.  However, 
for  new,  more  profitable 
in 
securitisations  have 
temporarily 
resulted 
increased  provisioning  needs 
leading  some 
systemic banks to post losses in the first 9 months 
of  2021.  Overall,  banks’  core  profitability  is  still 

Table A16.1: Financial soundness indicators 

(1) Last data: Q3 2021 
Source: ECB, Eurostat, Refinitiv 

54 

 
 
 
 
 
 
 
 
 
excessively punish business failure.  

Greek 

capital 

markets 

The 
are 
underdeveloped  and  alternative  sources  of 
non-bank  financing  remain 
limited.  The 
market-funding  ratio  has  improved  steadily  since 
2016  but  remains  low,  reaching  25.8%  in  2020 
compared  to  an  EU  average  of  50%.  Initial  public 
offering  and  bond  issuance  activity  rebounded  in 
2021.  This  includes  the  issuance  of  green  bonds 
which  has  started  to  gain  momentum  in  2021, 
albeit  remaining  below  EU  average  levels.  In  the 
area  of  FinTech,  a  supervisory  sandbox  was 
launched  by  the  Bank  of  Greece  in  June  2021, 
thanks  to  EU  financing  and  technical  assistance 
from  the  European  Bank  for  Reconstruction  and 
Development.  

55 

 
 
ANNEX 17: MACROECONOMIC IMBALANCE PROCEDURE ASSESSMENT MATRIX 
ANNEX 17: MACROECONOMIC IMBALANCE PROCEDURE ASSESSMENT MATRIX 

the 

labour  market 

sheets,  improving  the  insolvency  regime, 
and 
reforming 
implementing a number of structural reforms 
to  improve  the  business  environment  and 
support  productivity  growth.  Greece  has  also 
embarked  on  the  implementation  of  its  recovery 
and resilience plan, which – if fully implemented – 
is  projected 
to 
the  above  mentioned  economic 
addressing 
vulnerabilities. 

significantly 

contribute 

to 

For  those  reasons,  and  more  generally  on  the 
basis  of  the  elements  of  the  in-depth  review 
undertaken  for  Greece  under  Regulation  (EU)  No 
1176/2011  on  the  prevention  and  correction  of 
macroeconomic imbalances as summarised in the 
Staff  Working  Document  (SWD  (2022)630  final), 
the  Commission  has  considered 
its 
Communication  “European  Semester  –  2022 
Spring  Package”  (COM(2022)600  final)  that 
Greece  continues  to  experience  excessive 
imbalances. 

in 

The  Macroeconomic 
Imbalance  Procedure 
matrix presents the main elements of the in-
depth  review  undertaken  for  the  Greece  in 
accordance  with Article  5  of  Regulation  (EU) 
No  1176/2011  on  the  prevention  and 
correction  of  macroeconomic  imbalances,  as 
summarized  in  SWD(2022)630  final (55).  For 
Member  States  selected 
in  the  2022  Alert 
Mechanism Report it presents, separately for each 
source  of  imbalance  and  adjustment  issue,  the 
main  findings  regarding  the  gravity  and  the 
evolution  of  the  identified  challenges,  as  well  as 
policy response and gaps. 

low 

potential 

Greece  entered  the  COVID-19  crisis  with 
vulnerabilities  linked  to  high  public  debt,  a 
high  stock  of  non-performing  loans  and 
incomplete external rebalancing, in a context 
of 
high 
unemployment.  The  pandemic  has  lead  to  an 
increase  in  the  government  debt  and  external 
imbalances, while further progress has been made 
on reducing the stock of non-performing loans and 
a  large  impact  on  the  labour  market  has  been 
successfully averted. 

growth 

and 

With  the  pandemic  gradually  fading  out,  the 
macro-economic  adjustment  process  has 
restarted. Public debt-to-GDP ratio is projected to 
decrease  in  2022,  yet  the  current  account  is 
projected  to  remain  wide  in  2022  due  to  a 
deterioration in the trade balance of goods, in view 
of  the  projected  slowdown  in  the  EU  and  the 
global  economy  as  a  whole  after  the  military 
aggression  in  Ukraine.  It  is,  however,  expected  to 
shrink in 2023, yet remain below its pre-pandemic 
level. The current account stands well below what 
would be needed to ensure a lasting improvement 
investment  position. 
in  the  net 
Despite  substantial  progress  in  the  reduction  of 
non-performing 
loans  on  the  banks’  balance 
sheets,  their  non-performing  loan  ratio  remains 
the  highest  in  the  Euro  area,  while  the  banks’ 
capacity to internally generate capital remains low. 

international 

The  authorities  continued  to  take  relevant 
measures  to  facilitate  economic  adjustment, 
notably  through  reducing  the  legacy  of  non-
performing  exposures  to  the  banks’  balance 

(55)  European Commission (2022), COMMISSION STAFF 

WORKING DOCUMENT In-Depth Review for Greece in 
accordance with Article 5 of Regulation (EU) No 1176/2011 
on the prevention and correction of macroeconomic 
imbalances. 

56 

 
 
                                                 
 
Table A17.1: Assessment of Macroeconomic Imbalances matrix 

Source: European Commission 

57 

 1  Gravity of the challenge Evolution and prospects Policy response Imbalances (unsustainable trends, vulnerabilities and associated risks) Public debt Greece has a high level of public debt, amounting to 193.3% of GDP in 2021. The Commission’s fiscal sustainability assessment shows that Greece faces high fiscal sustainability risks over the medium term and medium ones in the long run. Greece’s debt is largely extended to official creditors at long maturities and concessional rates, which – together with the large cash buffer – insulates Greece from short-term fluctuations. The debt-to-GDP ratio dropped by 13 percentage points in 2021 on the back of the strong rebound of the GDP and is expected to decrease further in 2022, also reflecting the gradual phase out of the support measures and the strong recovery of the economy.  Greece reached high primary surpluses in the years before the outbreak of the pandemic and the 2022 Stability Programme presented by the authorities in April 2022 envisages that primary surpluses will be restored as of 2023. Greece’s RRP includes actions that aim to finance additional investment in support of the recovery. Nationally-financed investment is forecast to be preserved. Financial sector The banking sector is burdened by a high, albeit significantly reduced, stock of non-performing loans (12% on a consolidated basis in September 2021) and banks’ recurrent profitability remains low. The capital position of the banking system is one of the lowest in the euro area (15% as of September 2021) and its quality remains weak, while the link to the Greek sovereign, through various channels, has been further reinforced. Moreover, downside risks for banks’ asset quality persist, given the phase-out of state-support measures. Banks’ ability to offer viable long-term solutions will be key to sustain the pace of non-performing loan reduction going forward, together with further enhancements in debt enforcement and efforts to improve payment culture.  The debt repayment capacity of both households and nonfinancial corporations remains low, while the underdeveloped capital market limits firms’ access to nonbank financing. The non-performing loans ratio declined strongly by 17.8 pps. to reach 12% at end-September 2021 and is forecast to reach single-digit during 2022. This non-performing private debt has exited the banks’ balance sheets but still remains in the economy and represents a burden to economic recovery.  The impact of the recent securitisation transactions on banks’ capital positions was partly offset by successful capital enhancing actions in 2021. Banks’ profit outlook remains challenging, thus limiting so far the internal capital generation capacity. A pick-up in economic activity and reduced impairments following recent efforts to reduce non-performing loans are expected to offer support and offset pressures on the banks’ cost of funding. The implementation of the Hercules asset protection scheme to securitise banks’ non-performing loans is progressing.  Furthermore, the new insolvency framework has entered into force as of 1 June 2021 and its electronic infrastructure is fully operational. An interim support scheme for vulnerable debtors with primary residences [has been adopted] to prevent litigations stemming from the delay with setting up the sale-and-lease-back entity. Implementation of policy actions to eliminate the existing backlog of household insolvency cases and to enhance the efficiency of enforcement continues. Greece’s RRP includes measures to strengthen the financial sector and the capital markets and a Loan Facility to promote private investment.  External sustainability and competiveness Greece has a high stock of net external liabilities (its net international investment position was -175.2% of GDP in 2021) but its external liabilities are mainly composed of debt instruments held by official creditors, which mitigates the country’s exposure to external shocks or shifts in market sentiment. The current account deficit in cyclically adjusted terms (-9.3% of GDP in 2021) remains far from the required current account to reach a prudent Net International Investment Position. The size of Greece’s external liabilities has remained broadly stable in 2021, reflecting the moderate narrowing of the current account deficit and the economic recovery which started later in 2021.  The current account deficit in cyclically adjusted terms is forecast to improve over the following years, reaching -7.5% in 2022 and -4.1% in 2023, as tourism is expected to recover at its pre-pandemic level by end-2023. The authorities have completed a series of measures towards the simplification of processes and the acceleration of investment licensing procedures. Similarly, a new strategy to facilitate trade and foreign direct investment has been adopted. Greece’s RRP includes measures to increase extroversion and to improve the regulatory environment for businesses and exporters, by reducing entry barriers, improving the capacity of market surveillance structures and rationalising export processes. Potential growth and productivity Potential GDP growth in Greece has been negative since 2010, on account of weak total factor productivity growth, declining capital stock and an erosion of the country’s human capital.  The large share of micro and small businesses is an aggravating factor as most small and medium-sized enterprises struggle with access to finance and regulatory barriers.  Low potential growth slows down the deleveraging from the high debts and hampers adjustment and resilience in general. The impact of the temporary economic shock due to the pandemic on potential output in the longer run remains uncertain. Investment, also supported by the funds under the Recovery and Resilience Plan, is expected to record significant gains in the following years. According to Commission estimates, the GDP level is expected to increase by 2.1-3.3% by 2026, from the combined effect of the RRF grants and loans component. Such simulations do not include the possible positive impact from the structural reforms under the plan, which could be substantial. The Greek authorities adopted in 2021 ambitious reforms in the areas of labour and energy markets, the business environment, and public administration, while continued improving the governance of state-owned enterprises and its privatization agenda.  The authorities also put in place a project preparation facility and a strategic projects pipeline, which, also with revised public procurement legislation, are expected to support the implementation of public investments.  Greece’s RRP includes actions to incentivise the increase of average company size and reduce the administrative and regulatory burden, while continuing the efforts to modernise the public administration. Moreover, it includes important infrastructural projects in key economic sectors. Adjustment issues Labour market and unemployment Unemployment decreased significantly, yet at 14.7% in 2021, down from its peak of 27.8% in 2013, it remains one of the highest in the EU, while youth unemployment remains the highest in the EU (at 35.5% in 2021 compared to 16.6% in the EU). The employment rate stood at 62.6% in 2021, 10.5 percentage points below the EU average. The still weak labour market performance reduces Greece’s social and economic resilience and increases risks of poverty and social inclusion.  Unemployment in 2021 was 1.6 percentage points below compared with 2019, and is expected to decrease further. Employment has fully recovered its losses due to the pandemic (in 2021 it was 0.4 percentage points above the 2019 level). Unemployment is expected to decrease to 13.7% in 2022 as the economy absorbs the slack in the labour market and the inactive population returns to labour. Since the outbreak of the pandemic, the authorities have put forward temporary and targeted measures to maintain jobs and prevent a sharp increase in unemployment. These have helped contain net job losses and have supported incomes. Greece’s RRP includes both active and passive labour market policies including activation programmes that subsidize employment and promote the upskilling and reskilling of the labour force. The plan also envisages investments to boost the capacity of the public employment service through the upgrade of its counselling services   
 
  
 
ANNEX 18: TAXATION 
ANNEX 18: TAXATION 

This  Annex  provides  an 
indicator-based 
overview  of  Greece’s  tax  system.  It  includes 
information on the tax structure, i.e. the types of tax 
that  Greece  derives  most  revenue  from,  the  tax 
burden  for  workers,  and  the  progressivity  and 
redistributive effect of the tax system. It also provides 
information on tax collection and compliance and on 
the risks of aggressive tax planning activity. 

Greece’s  tax  revenues  are  around  the  EU 
average  in  relation  to  GDP,  and  the  tax 
system  is  slightly  less  reliant  on  labour 
taxation  while  relatively  more  on  growth-
friendly  tax  bases.  Greece’s  tax  revenues  have 
been increasing in recent years and are now in line 
with the euro-area average. Since 2020, important 
steps have been made to improve the composition 
of  tax  revenues  by  reducing  corporate  and 
personal  tax and social security contribution rates 
and 
improving  tax  collection,  but  challenges 
remain in all these areas.  

Table A18.1: Taxation indicators 

level.  Despite  relatively  large  tax  revenues,  in  2020 
the  tax-benefit  system  helped  reduce  inequality,  as 
measured by the GINI coefficient, by less than the EU 
average. 

Greece is continuing the digitalisation of the tax 
administration,  which  can  help  reduce  tax 
arrears  as  well  as  cut  compliance  costs. 
Outstanding tax arrears declined by 13.4 pp. between 
2018 and 2019 to 212.3% of total net revenue, but 
remained  well  above  the  EU27  average  of  31.8%. 
However, in individual terms, there is a clear declining 
trend. More recent data on tax return e-filing rates in 
the Annual Report for Taxation reveal an encouraging 
trend (56).  The  VAT  gap 
indicator  of  the 
effectiveness  of  VAT  enforcement  and  compliance) 
has declined significantly from 29% in 2018 to 25.8% 
in 2019. However, it remained well above the EU-wide 
gap of 10.5% (57). Finally, the average forward-looking 
effective corporate income  tax rates have decreased 
but remained above the EU average in 2020 (23% vs. 
19.3%).  

(an 

(1)  Forward-looking effective tax rate (OECD) 
(*) EU-27 simple average as there is no aggregated EU-27 value 
Source: European Commission, OECD 

Greece’s  labour  tax  burden  is  around  the  EU 
average  at  various  wage  levels.  The  labour  tax 
wedge for Greece in 2020 was around the EU average 
at various income levels, i.e.  for  single people  at the 
average  wage  (100%)  as  well  as  at  50%,  67%  and 
167%  of  the  average  wage.  Second  earners  at  a 
wage  level  of  67%  of  the  average  wage,  whose 
spouse  earns  the  average  wage,  also  face  a  tax 
wedge  around  the  EU  average,  but  they  are  taxed 
slightly  more  than  single  people  at  the  same  wage 

58 

(56)  European Commission, Directorate-General for Taxation and 
Customs Union, Annual Report on Taxation 2021: review of 
taxation policies in the EU Member States, Publications 
Office, 2021, https://data.europa.eu/doi/10.2778/294944, 
see section 2.1.4 Improving tax administration of the Annual 
Report on Taxation 2021 for further details 

(57)  For more details see European Commission, Directorate-

General for Taxation and Customs Union, “VAT gap in the EU : 
report 2021”, Publications Office, 2021, 
https://data.europa.eu/doi/10.2778/30877 

 
 
                                                 
 
 
 
 
Graph A18.1: Tax wedge indicators 

(1) The second earner average tax wedge measures how much extra personal income tax plus employee and employer social 
security contributions (SSCs) the family will have to pay as a result of the second earner entering employment, as a proportion of 
the second earner’s gross earnings plus the employer SSCs due on the second earner’s income. For a more detailed discussion see 
OECD (2016), Taxing Wages 2016, OECD Publishing, Paris. http://dx.doi.org/10.1787/tax_wages-2016-en  
(*) EU-27 simple average as there is no aggregated EU-27 value. 
Source: European Commission 

59 

 
 
ANNEX 19: KEY ECONOMIC AND FINANCIAL INDICATORS 
ANNEX 19: KEY ECONOMIC AND FINANCIAL INDICATORS 

Table A19.1: Key economic and financial indicators 

(1) Net international investment position (NIIP) excluding direct investment and portfolio equity shares 
(2) Domestic banking groups and stand-alone banks, and EU and non-EU foreign-controlled subsidiaries and EU and non-EU 
foreign-controlled branches.   
Source:  Eurostat and ECB as of 2022-05-02, where available; European Commission for forecast figures (Spring forecast 2022) 

60 

 
 
 
 
 
 
 
ANNEX 20: DEBT SUSTAINABILITY ANALYSIS 
ANNEX 20: DEBT SUSTAINABILITY ANALYSIS 

This  annex  assesses  fiscal  sustainability 
risks  for  Greece over the  short, medium  and 
long term. It follows the same multi-dimensional 
approach as the 2021 Fiscal Sustainability Report, 
updated  on  the  basis  of  the  Commission  2022 
spring forecast. 

Table  1  presents 
the  baseline  debt 
projections.  It  shows  the  projected  government 
debt  and  its  breakdown  into  the  primary  balance, 
the  snowball  effect  (the  combined  impact  of 
interest payments and nominal GDP growth on the 
debt  dynamics)  and  the  stock-flow  adjustment. 
These projections assume that no new fiscal policy 
measures  are  taken  after  2023,  and  include  the 
expected  positive  impact  of  investments  under 
Next Generation EU. 

Graph  1  shows  four  alternative  scenarios 
around  the  baseline, to  illustrate the  impact 
of changes in assumptions. The ‘historical SPB’ 
scenario  assumes  that  the  structural  primary 
balance (SPB) gradually returns to its past average 
level.  In  the  ‘lower  SPB’  scenario,  the  SPB  is 
permanently  weaker  than  in  the  baseline.  The 
‘adverse interest-growth rate’ scenario assumes a 
less  favourable  snowball  effect  than 
in  the 
baseline.  In  the  ‘financial  stress’  scenario,  the 
country  temporarily  faces  higher  market  interest 
rates in 2022.  

Graph 2 shows the outcome of the stochastic 
projections.  These  projections  show  the  impact 
on  debt  of  2  000  different  shocks  affecting  the 
government’s 
economic 
growth,  interest  rates  and  exchange  rates.  The 
cone covers 80% of all the simulated debt paths, 
therefore excluding tail events. 

budgetary 

position, 

Table  2  shows  the  S1  and  S2  fiscal 
sustainability 
indicators  and  their  main 
drivers.  S1  measures  the  consolidation  effort 
needed to bring debt to 60% of GDP in 15 years. 
S2  measures  the  consolidation  effort  required  to 
stabilise  debt  over  an  infinite  horizon.  The  initial 
budgetary position measures the effort required to 
cover  future  interest  payments,  the  ageing  costs 
component  accounts  for  the  need  to  absorb  the 
projected 
public 
expenditure  such  as  pensions,  health  care  and 
requirement 
long-term  care,  and 
measures  the  additional  adjustment  needed  to 
reach the 60% of GDP debt target. 

in  ageing-related 

the  debt 

change 

61 

Finally,  the  heat  map  presents  the  overall 
fiscal sustainability risk classification (Table 
A20.2).  The  short-term  risk  category  is  based  on 
the  S0  indicator,  an  early-detection  indicator  of 
fiscal  stress  in  the  upcoming  year.  The  medium-
term  risk  category  is  derived  from  the  debt 
sustainability  analysis  (DSA)  and  the  S1  indicator. 
The DSA assesses risks to sustainability based on 
several  criteria:  the  projected  debt  level  in  10 
years’  time,  the  debt  trajectory  (‘peak  year’),  the 
plausibility  of  fiscal  assumptions  and  room  for 
tighter  positions  if  needed  (‘fiscal  consolidation 
space’),  the  probability  of  debt  not  stabilising  in 
the  next  5  years  and  the  size  of  uncertainty.  The 
long-term  risk  category  is  based  on  the  S2 
indicator and the DSA.  

to 

risks 

short-term 

Overall, 
fiscal 
sustainability are high. The Commission’s early-
detection  indicator  (S0)  signals  high  short-term 
fiscal  risks  (Table  A20.2).  However,  financing 
conditions should remain favourable, mainly since 
a large share of debt is held by the official sector. 
(Table 1). 

Medium-term  risks  to  fiscal  sustainability 
are  high.  The  two  elements  of  the  Commission’s 
medium-term  analysis  lead  to  this  conclusion. 
First,  the  debt  sustainability  analysis  (DSA)  shows 
that government debt is projected to decline from 
around  186%  in  2022  to  about  131%  of  GDP  in 
2032 in the baseline (Table 1). However, the debt 
path is highly sensitive to possible shocks to fiscal, 
macroeconomic  and 
financial  variables,  as 
illustrated  by  alternative  scenarios  and  stochastic 
simulations  (Tables  A20.1  and  A20.2).  Moreover, 
the sustainability gap indicator S1 signals that an 
adjustment  of  4.4  pps.  of  GDP  of  the  structural 
primary  balance  would  be  needed  to  reduce  debt 
to 60% of GDP in 15 years’ time (Table 2). Overall, 
the  high  risk  reflects  the  high  debt  level  and  the 
high sensitivity to adverse shocks. 

the  DSA  points 

Long-term  risks  to  fiscal  sustainability  are 
medium.  Over  the  long  term,  the  sustainability 
gap indicator S2 (at -3.2 pps. of GDP) points to low 
risks,  while 
to  substantial 
vulnerabilities,  leading  to  the  overall  medium  risk 
assessment.  The  S2  indicator  suggests  that  the 
projected  decline  in  public  pension  expenditure 
relative  to  GDP  will  help  stabilise  debt  over  the 
long  term  despite  budgetary  pressures  stemming 
2). 
from 

health 

(Table 

care 

 
 
 
 
Table A20.1: Debt sustainability analysis for Greece 

Source: European Commission 

Table A20.2: Heat map of fiscal sustainability risks for Greece 

(1) Debt level in 2032: green: below 60% of GDP, yellow: between 60% and 90%, red: above 90%. (2) The debt peak year 
indicates whether debt is projected to increase overall over the next decade. Green: debt peaks early; yellow: peak towards the 
middle of the projection period; red: late peak. (3) Fiscal consolidation space measures the share of past fiscal positions in the 
country that were more stringent than the one assumed in the baseline. Green: high value, i.e. the assumed fiscal position is 
plausible by historical standards and leaves room for corrective measures if needed; yellow: intermediate; red: low. 
(4) Probability of the debt ratio exceeding in 2026 its 2021 level: green: low probability, yellow: intermediate, red: high (also 
reflecting the initial debt level). (5) The difference between the 90th and 10th percentiles measures uncertainty, based on the 
debt distribution under 2000 different shocks. Green, yellow and red cells indicate increasing uncertainty.  
Source: European Commission (for further details on the Commission’s multi-dimensional approach, see the 2021 Fiscal 
Sustainability Report). 

62 

Table 1. Baseline debt projections20192020202120222023202420252026202720282029203020312032Gross debt ratio (% of GDP)180.7206.3193.3185.7180.4172.0164.9159.8158.5152.4146.6141.1135.8130.5Change in debt-5.725.7-13.1-7.6-5.2-8.4-7.1-5.2-1.3-6.0-5.8-5.6-5.3-5.3of whichPrimary deficit-4.27.25.01.9-1.3-2.7-3.4-3.7-2.4-2.5-2.5-2.5-2.5-2.5Snowball effect-0.822.6-17.3-12.5-6.7-6.0-4.4-3.01.6-2.9-2.6-2.3-2.1-2.1Stock-flow adjustment-0.8-4.1-0.73.12.80.30.81.5-0.5-0.6-0.7-0.7-0.7-0.7Gross financing needs (% of GDP)22.319.520.319.214.48.27.612.812.912.310.911.212.414.7S1S2Overall index (pps. of GDP)4.4-3.2of whichInitial budgetary position-4.0-0.7Debt requirement9.6Ageing costs-1.2-2.5of whichPensions-1.1-2.6Health care0.30.7Long-term care0.00.0Others-0.3-0.6                                                                       Table 2. Breakdown of the S1 and S2 sustainability gap indicators1151251351451551651751851952052152019202120232025202720292031BaselineHistorical SPB scenarioLower SPB scenarioFinancial stress scenarioAdverse 'r-g' scenarioGraph 1. Deterministic debt projections (% of GDP)p10-p20p20-p40p40-p60p60-p80p80-p9011512513514515516517518519520521520192020202120222023202420252026Graph 2. Stochastic debt projections(% of GDP)MedianBaselineBaselineHistorical SPBLower SPBAdverse 'r-g'Financial stressOverallHIGHHIGHHIGHHIGHHIGHMEDIUMDebt level (2032), % GDP130122152132134Debt peak year20212021202120212021Fiscal consolidation space25%22%46%25%25%Probability of debt ratio exceeding in 2026 its 2021 level8%Difference between 90th and 10th percentiles (pps. GDP)59LOWMEDIUMDeterministic scenariosStochastic projectionsHIGHHIGHHIGHHIGHShort termMedium termLong termOverall                               (S0)Overall     (S1+DSA)S1Debt sustainability analysis (DSA)S2Overall     (S2+DSA)Overall 
 
   
   
  
   
63