Greece has slipped to 50th place among 69 economies in the International Institute for Management Development (IMD) World Competitiveness Yearbook 2025. The country lost three positions compared to 2024 and four over a five-year period, as highlighted in the new KEFIM policy paper titled “The Competitiveness of the Greek and European Economies: Challenges and Prospects.”
The study analyzes the country’s international standing, linking it to the European debate sparked by the Draghi Report, the European Commission’s Competitiveness Compass, and the planning of the new Multiannual Financial Framework (MFF) 2028–2034.
Key findings of the study
Structural lag in the pillars: In three of the four key pillars (Business Efficiency, Economic Efficiency, and Government Efficiency), Greece remains stuck in 53rd place out of a total of 69 countries.
Brain drain and financing: The sharpest decline was recorded in Business Efficiency (-9 places), driven by the outflow of scientific talent (64th place) and lagging financial services (61st place).
Cost of capital and infrastructure: Fiscal consolidation has not yet translated into lower costs of capital (60th place), while in the infrastructure sector, the country remains stagnant at 40th place for the third consecutive year.
Top ranking in business complexity: According to the TMF Group’s Global Business Complexity Index (GBCI 2026), Greece ranks for the third consecutive year as the country with the highest complexity globally in doing business, due to frequent legislative and regulatory changes.
Increase in investment without new capital accumulation: During the 2021–2025 period, Gross Fixed Capital Formation (GFCF) recorded growth rates significantly higher than the EU-27 average (reaching +21.8% in 2021 and +21.9% in 2022). This rise reflects the replenishment of capital lost during the crisis, but not yet a sustainable accumulation of new productive capital.
Delays in Pissarides’ reforms: The sectors with the greatest implementation lag—namely Justice, Labor, and Finance—are the key factors preventing the conversion of investments into real competitiveness.
European subsidies vs. regulatory barriers: The MFF 2028–2034 provides for digital subsidies totaling €51.5 billion, citing the Draghi Report. However, the study emphasizes that the fragmentation of capital markets and regulatory barriers remain the root causes of the problem.
Statement by the KEFIM President
KEFIM President Nikos Rompapas emphasized the importance of productive upgrading:
“Competitiveness is not just a matter for economists or businesses. It is the way in which a country harnesses human capital, investments, and reforms to create better jobs, higher incomes, and more opportunities for its citizens.
Greece has taken significant steps toward stabilization in recent years. But stabilization alone is not enough. The next major challenge is to upgrade the economy’s productivity: less complexity, better access to capital, faster implementation of reforms, and a more favorable business environment.
The same applies to Europe. If the European response is limited to more subsidies without deeper institutional changes, the European Union will not be able to position itself favorably in the increasingly intense global competition. Greece and Europe need fewer barriers, deeper capital markets, more private investment, and a more innovation- and labor-friendly environment.”