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Greece’s Fiscal Surplus Narrows In 2025 As Government Spending Rises

Overview Of Fiscal Balance And Performance

The Greek General Government recorded a fiscal surplus of €939.2 million between January and December 2025, equivalent to 2.6% of GDP. The figure is lower than the €1,439.3 million surplus, or 4.1% of GDP, reported during the same period in 2024. Revenue growth continued during the year, while higher public spending reduced the overall surplus compared with the previous year.

Revenue Growth And Sectoral Shifts

Total government revenue increased by €864.8 million in 2025, rising 5.9% to €15,615.2 million from €14,750.3 million in 2024.

Income and wealth taxes rose by €341.3 million, or 9%, reaching €4,146 million compared with €3,804.7 million a year earlier. Social contributions increased by €358.7 million, or 7.9%, totaling €4,878.7 million.

Interest and dividend income rose by €37.4 million, or 30.4%, reaching €160.3 million. Taxes on production and imports increased slightly by €14 million, or 0.3%. Net VAT revenue declined by €52.8 million, or 1.7%.

Sales of goods and services generated €159.6 million more in revenue, representing a 17.9% increase to €1,049.4 million. Current transfers rose by €27.9 million, or 7.1%, to €421.1 million. Capital transfers declined by €74.1 million, or 22%, to €262.9 million.

Rising Government Expenditures

Government spending increased by €1,364.9 million in 2025, rising 10.3% to €14,675.9 million compared with €13,311 million in 2024. Personnel costs, including estimated social security contributions and public sector pensions, rose by €253.3 million, or 6.5%, reaching €4,131.2 million.

Social benefits increased by €382.3 million, or 7.2%, totaling €5,686 million. Intermediate consumption rose by €136 million, or 9.3%, to €1,600.8 million. Current transfers also increased, rising by €77.8 million, or 9.2%, to €920.2 million.

Capital Expenditure And Debt Costs

Capital expenditure recorded the largest increase during the year. The capital account rose by €562.1 million, or 46.6%, reaching €1,767.2 million.

Growth was driven by fixed capital investment, which increased by €242.6 million, or 25.1%, to €1,207.3 million. Other capital transfers also expanded, rising by €319.5 million from €240.4 million.

Interest payments on government debt declined by €27 million, or 6.1%, reaching €418.7 million. Subsidies also fell, decreasing by €19.6 million, or 11.4%, to €151.8 million.

Data Reporting Notes

Greece’s statistical authority reported that estimates were used for certain entities within the General Government sector, particularly within local government, due to incomplete data submissions from the relevant authorities.

Limassol Port Electrification Awaits Grid Connection And EU Funding

Plans to equip Limassol port with shore-side electricity are advancing at the technical level, but unresolved administrative procedures, a pending grid connection and the need to secure European funding continue to delay implementation.

The proposed shore-power system, also known as cold ironing, would allow vessels to connect to electricity while berthed, reducing reliance on onboard engines and cutting emissions and noise in the surrounding area.

Technical Studies Near Completion

Transport Minister Evi Tsolaki said work is progressing through the EU-backed DecarbonLim programme, which is preparing the technical assessment and feasibility study required before construction can begin. The ministry is seeking regular updates from the Cyprus Ports Authority on the studies’ completion timetable.

The initiative also involves Frederick University, Eurogate Container Terminal Limassol, DP World Limassol, the Electricity Authority of Cyprus, the Cyprus Transmission System Operator and Limassol Municipality.

Grid Connection Remains A Key Hurdle

Despite progress on the studies, construction cannot proceed until the project secures a connection to the national transmission network.

Tsolaki said the ministry has requested land from the Department of Lands and Surveys for an electricity substation. Once the site is allocated, the relevant applications can be submitted to the Cyprus Transmission System Operator to advance the grid-connection process.

Until these steps are completed, the project will remain in the preparatory phase, even if the technical studies are finalised.

European Funding Adds Urgency

The feasibility work under DecarbonLim will support an application for construction financing, Tsolaki said. A competitive European funding call is currently open, and the ministry intends to submit an application within the required timeframe.

The funding window has raised concerns in parliament. MP Fotini Tsiridou warned that further delays could undermine Cyprus’ chances of securing EU support, noting that similar port electrification projects elsewhere in the bloc have already received funding.

Speaking to Entrepreneurial Limassol, published by the Limassol Chamber of Commerce and Industry, Tsiridou said she had observed some progress but had yet to receive a formal response to her parliamentary question.

Environmental And Commercial Benefits

Tsiridou argued that shore-side electricity would deliver benefits beyond emissions reductions, including less noise and air pollution for residents near the port.

“Our port should not be disconnected from the rest of the city,” she said, describing shore-power infrastructure as both a necessity and a European obligation.

Across Europe, port electrification is increasingly linked to environmental performance and competitiveness. By allowing compatible vessels to switch off auxiliary engines while docked, shore-power systems can reduce local emissions and noise while supporting wider decarbonisation goals.

Construction Timetable Still Unclear

The Cyprus Ports Authority signed a contract with DBA S.p.A. in July 2025 for a comprehensive study of the system’s technical, economic and environmental requirements. The work was intended to establish the basis for installation and identify any necessary port infrastructure upgrades.

More than a year later, key steps concerning land allocation, grid connection and financing remain unresolved. No timetable has been announced for completing these procedures or submitting the final funding application.

Limassol’s shore-power project therefore remains between planning and implementation. Its next milestones are securing the substation site, progressing the transmission-network application and obtaining construction financing. Until these are in place, the port’s transition to shore-side electricity cannot move into the construction phase.

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