Repeat elections will bring Greece a period of political stability elections, as long as the New Democracy can maintain its percentage while the number of parties that fall short of the 3% threshold remains high, according to DBRS Morningstar. The rating agency, which rates Greece’s creditworthiness just one notch below investment grade (high BB), says the election brings policy continuity.

A potential victory for the New Democracy will give it a mandate to continue reforms and investment, raising Greece’s growth prospects. At the same time, improved growth prospects and spending by the Development Fund of €30.5 billion are another factor that contributes to a possible improvement in the valuation, the chamber notes.

Greece has experienced a long period of political and economic stability in recent years, despite the challenges of the pandemic and the energy crisis, according to DBRS. Thanks to reforms and European support during the pandemic, the country posted a strong recovery in 2021 and 2022, with real GDP expected to grow by 2.4% in 2023, according to the Commission, driven mainly by domestic demand and especially by strong investment activity. , analysts say. The implementation of the Recovery Fund is expected to continue to stimulate reform and investment.

DBRS notes that Athens is looking to further improve the fiscal picture this year and reduce debt to 163% of GDP after Greece posted a small primary surplus in 2022.

The House of Representatives believes that the country will maintain its fiscal discipline, but identifies the risks associated with high public debt and a high share of non-performing loans in the banking system.

Polls Reveal Continuity and Reforms

Previously, S&P Global Ratings also indicated that the result of the Greek elections is a mandate to continue policies and reforms.

The ratings agency, which upgraded its outlook on Greece’s BB+ rating from stable to positive in April, says it could upgrade its rating (to investment grade) over the next 12 months if financial discipline is maintained in line with its outlook period. is until 2026. .

Modernization will also depend on whether the next government maintains the momentum of reforms, increasing the country’s economic competitiveness.

It is noted that the next scheduled revision of the credit rating of Greece by S&P will take place on October 20.