In a Europe entering 2026 with slow but remarkable resilience, Fitch Ratings highlights a fiscal reality that starkly differentiates the landscape. Most economies see their public finances under pressure, but Greece is placed in the narrow core of countries that will manage to maintain surpluses and continue to reduce debt.

According to the house, the country will show the largest debt reduction in Europe in 2019-2026, above 40 percentage points in GDP terms.

On the fiscal front, the scene is clearly more difficult. Fitch finds that spending pressures are rising faster than expected, led by defence and ageing costs. The EU deficit is projected to reach 2.7% of GDP in 2026, while the eurozone deficit will hover close to 3%.

But this also captures the big picture of “two-speed”. In Fitch’s forecasts, only Greece, Cyprus and Ireland appear with net fiscal surpluses in 2026, while Portugal is approaching balance. The common thread among these countries, according to the agency, is the deep adjustment of previous years and a firm commitment to primary surpluses even amid the crises of the pandemic and war in Ukraine.