One in three chances Application Ratings update it Greece at an investment level after the 2023 elections, as long as the country continues to comply with the rules of the European Union and therefore continues to receive support from institutions on the fiscal and monetary policy front.

The house, which is not (yet) reviewed by the European Central Bank and is being “watched” by the markets, was the first to give a positive outlook on Greece’s BB+ rating (one notch below investment grade). the next 12-18 months.

Stronger European institutional support for Greece — a development that Scope predicts will continue beyond the current crisis — could argue for a BBB Investor Rating if that support continues beyond next year’s elections and beyond the COVID-19 crisis. “We anticipate that post-pandemic fiscal and monetary policy innovations can be reintroduced during future crises if required, supporting the debt sustainability of vulnerable countries such as Greece,” the rating agency said. “As long as Greece continues to comply with EU rules, Scope believes the ECB is likely to support Greek markets going forward under adverse scenarios by providing much-needed financial support,” he adds.

The House of Representatives estimates that Greek economic growth will slow to 1.1% next year, but recover to 1.5% and above potential levels by 2024 and move at a rate of 1.4% in 2025-2027. This comes after a strong economic recovery since spring 2020 (8.3% growth in 2021 and a further projected 6% growth in 2022). While inflation will remain high for longer, exacerbating the cost-of-living crisis, it will decline from 9.5% in 2022 to an even higher 5.8% in 2023.

Greece’s outlook is receiving significant support from a downward debt trajectory, as Scope highlights, while a return to a primary fiscal surplus by next year looks likely. The Debt Sustainability Analysis prepared by the House of Representatives predicts that Greece’s debt to GDP ratio will reach 169.3% this year and 147% by 2027, reflecting a significant decline from the record 206.4% set in 2020. and equals the debt levels of other countries. eurozone debtor states, explains Scope.

However, Greece’s rating outlook for next year is constrained by a number of factors, including 1) an increase in government debt, 2) weaknesses in the banking system even as NPLs decline, 3) structural financial weaknesses, and 4) uncertainty surrounding the 2023 election as any change in economic policy after the election could increase financial risk, warns Scope.