Greek PM Mitsotakis to Unveil Major Economic Reforms in Annual Speech

Greek PM Kyriakos Mitsotakis plans to introduce measures to boost pensions, reduce social security contributions, and enhance public services. The initiative aims to address voter concerns over the cost of living. Funded with 3 billion euros, the reforms target healthcare, education, housing, and birthrate issues.

Greek Prime Minister Kyriakos Mitsotakis is set to announce plans on Saturday to raise pensions, cut social security contributions, and enhance public services to win back voters dissatisfied by a lingering cost of living crisis.

In his annual economic speech, Mitsotakis will prioritize boosting purchasing power and allocating more funds to education and healthcare, according to three government sources. Measures to improve housing and curb a declining birthrate, funded by reducing unemployment benefits, are also expected.

The government intends to allocate 3 billion euros to these initiatives in 2025, about 1.5% of GDP. A senior government official highlighted the commitment to increasing public investment and efficiency, particularly in high-impact areas like health, education, security, and civil protection.

Mitsotakis seeks to balance voter appeasement and fiscal prudence. Greece has posted higher-than-expected primary surpluses in recent years, allowing for additional spending without jeopardizing economic stability. Despite progress, many citizens still struggle with high unemployment and low GDP per capita, exacerbated by rising food and energy costs amid climate change impacts.

The centre-right New Democracy party, re-elected in 2023 on wage-boosting promises, has seen a dip in popularity, reflected in recent European parliamentary election losses. The PM aims to reaffirm the government's dedication to fiscal prudence and economic progress achieved over the past five years.

(With inputs from agencies.)