## Greece: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Greece

_IMF Staff Country Reports, November 15, 2019_

## Source details

**Canonical URL:** [Greece: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Greece](https://www.imf.org/en/publications/cr/issues/2019/11/14/greece-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48806)

## Other formats

- [Markdown version](/en/publications/cr/issues/2019/11/14/greece-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48806/index.md)
- [Structured JSON version](/en/publications/cr/issues/2019/11/14/greece-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48806/index.json)
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## Bibliographic details
- Published: November 15, 2019
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513520209.002

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### Summary and key messages
- Public debt is projected to trend down over the next decade, though long-term sustainability is not assured under realistic macro-fiscal assumptions.
- Still-weak bank balance sheets act as a drag on growth prospects and pose significant fiscal and financial stability risks.
- Greece is vulnerable to a range of external and domestic shocks.
- Improved living standards and economic convergence within the Euro Area (EA) depend on implementing a critical mass of inter-related fiscal, financial, and structural policy reforms.
- Success within the currency union critically hinges on narrowing Greece’s structural competitiveness gap.

### Growth and fiscal policy guidance
- Fiscal policy mix should be improved with:
  - more emphasis on investment and targeted social spending,
  - lower direct taxes,
  - reforms in revenue administration and public financial management.
- These fiscal adjustments aim to achieve better growth and social outcomes while addressing sustainability concerns.

### Banking sector and financial stability
- Bank balance sheets remain weak and:
  - act as a drag on growth prospects,
  - pose significant fiscal and financial stability risks.
- Addressing bank-sector weaknesses is essential to reduce macro-financial vulnerabilities.

### Structural reforms and competitiveness
- Policies should focus on productivity enhancement through:
  - improved labor market flexibility,
  - more effective labor activation policies,
  - stronger institutions,
  - business deregulation.
- Narrowing the structural competitiveness gap is identified as critical for Greece’s success in the Euro Area.

### Vulnerabilities and outlook
- Greece remains exposed to external and domestic shocks due to:
  - remaining fiscal risks tied to debt dynamics,
  - weak financial-sector balance sheets,
  - structural rigidities that limit convergence and productivity gains.

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## Content in this bundle

- **1. Illustrative Scenario—Higher Reform Payoffs**
  - [1. Illustrative Scenario—Higher Reform Payoffs (Markdown version)](/-/media/files/publications/cr/2019/1grcea2019002.pdf.md){rel="alternate" type="text/markdown"}
  - [1. Illustrative Scenario—Higher Reform Payoffs (PDF)](/-/media/files/publications/cr/2019/1grcea2019002.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2019/11/14/greece-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48806_