Credit ratings company Fitch bumped Greece’s credit outlook from stable to positive on Friday. The country’s rating remains at BB, which is two ranks below investment grade.
Fitch estimated in its new report that Greece’s economy grew 8.3% in 2021, almost double the 4.3% forecast the company had given it in July.
The company also cited Greek banks as a key motivator for the upgrade, writing that Greek banks “sharply reducing the level of non-performing loans.. and enhancing their ability to provide credit to the real economy.”
Fitch also predicts that Greece’s economic recovery will continue into 2022 and 2023, with the company estimating a 4.1% expansion for both years. Greece is also expected to settle its debt with the international Monetary Fund in 2022.
Eurostat reported last month that Greece had the largest gross domestic product (GDP) growth rate in the third quarter of 2021 in the entire Eurozone.
The statistics agency said that Greece’s GDP increased a staggering 13.7% in the third quarter compared to last year. To put that in perspective, the average growth rate amongst EU countries was 3.9%.
Greek Finance Minister Christos Staikouras said that the country’s growth rate for the past nine months has now reached 9.3%, significantly surpassing the 6.9% projection made for the same period by the government earlier this year.
This growth indicates that Greece’s year of recovery from 2020’s pandemic losses has been a success and positions the country to pivot into 2022, where it will have to convert its growth into long-term stability.
Greece’s growth in 2021 credited to tourism and recovery
Greece’s impressive third-quarter performance has been credited to a return of tourism and the success of Greece’s Recovery and Resilience Plan.
More than 8.6 million tourists visited Greece from January to August during 2021. The Bank of Greece reported that this is a 79% increase in the number of last year’s visitors during the same time frame.
2021’s blockbuster turnout in the tourism sector led to a 135% increase in earnings from 2020. The revenue for the first eight months of 2021 totaled 6.6 billion euros.
Greece welcomed more than two million visitors to its shores during just the months of July and August of 2021 — more than any other European nation — marking real success in its vital tourism industry despite the pandemic that is still raging across the world.
The two most popular months for Greek tourism haven’t seen that many visitors since 2019, which was a record year for tourism in the country.
The relative success of the season is due not only to the country’s well-established hospitality industry but also the nation’s acceptance of a range of different vaccines — not only the major Western inoculations — for proof of vaccination.