Country Economic Forecasts > Greece

On 23 November, Greece was finally deemed to have reached the first set of milestones under its new adjustment programme, clearing the way for the disbursement of a sub-tranche of funding amounting to 2bn. A second set of milestones is due to be implemented by mid-December to unlock another 1bn sub tranche. But this may prove challenging as two of the more problematic issues pension reform and a plan to resolve the stock non-performing loans were postponed to this second set of milestones.After growing very modestly in 2014 and H1 2015, initial estimates show that GDP fell 0.5% on the quarter in Q3 as the imposition of capital controls and uncertainty about Greece's membership of the single currency took their toll. Growth is seen at just 0.2% in 2015, with a 2.4% contraction forecast for 2016 and a further 1.7% decline seen in 2017. Attention will now switch to whether the government can implement the agreed reform measures, with future funding conditional on the successful completion of a full programme review. The first such review is due in December, and Athens is hopeful that a positive assessment will pave the way for negotiations on a possible restructuring of debt.