/RATINGS: Moody's On Greece's Credit Profile

Greece's stable credit profile balances the growth accelerating reforms implemented by the government over the past few years and its high public debt, which remains the key challenge to the country's creditworthiness, Moody's Investors Service said in a report published today.

• The country's credit profile reflects its relatively high wealth levels, set against the economy's moderate size and equally moderate economic diversification. The current government has improved Greece's institutions and governance in several areas. Thus, the country benefits from a favourable debt structure, a substantial cash buffer and strong debt affordability.
• "Greece's rating would come under upward pressure if further progress on structural reforms yielded tangible results in the form of stronger investment and further lifted and solidified medium-term growth prospects," says Steffen Dyck, a VP - Senior Credit Officer at Moody's and the author of the report. "Conversely, the rating would come under downward pressure if progress in reforming Greece's institutions were to be reversed, putting at risk the agreement with the euro area creditors."
• The coronavirus pandemic interrupted Greece's economic recovery and led to a sharp contraction in 2020, but substantial EU funds will be vital to bolstering investment and growth in the coming years. However, Greece's credit profile's main challenge remains its elevated debt burden, which was 205.6% of GDP in 2020 and is the second-highest among Moody's rated sovereigns.
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