Europe stands before one of the most significant economic decisions of the last decade.
With the Recovery Fund winding down gradually, within August 2026, and the new Multiannual Financial Framework being shaped, a question returns to the forefront that until a few years ago provoked intense reactions in European capitals: must the European Union proceed with a new round of joint borrowing to finance its massive investment needs?
The discussion is not theoretical. According to the report by the former president of the European Central Bank Mario Draghi, Europe needs investments approaching 800 billion euros annually in order to maintain its competitiveness against the United States and China.
Let us recall Spain's proposal at the recent summit for an annual borrowing of 850 billion in eurobonds, with the volume of issuances reaching 5 trillion euros by 2030, which was rejected by the usual suspects, the fiscally conservative countries of the North, but due to the investment gap confronting Europe, it will probably pass surreptitiously.
And this because of the significant difficulty in convincing the societies of the powerful economic states to assume liabilities on behalf of third states in view of moral hazard.
At the same time, the energy transition, digitalization, artificial intelligence, critical infrastructure, industrial policy, and the reinforcement of strategic autonomy require funds that can hardly be secured exclusively from national budgets.
For Greece, the debate acquires even greater significance.
The country has left behind the decade of the fiscal crisis, yet the challenges of the next day are equally demanding.
The preservation of fiscal stability must now go hand in hand with the need to realize large public and private investments.
Today's Greece is not the Greece of 2015 - Beyond the storefront
The image of the Greek economy has changed fundamentally in recent years.
The return to investment grade signaled the restoration of the country's credibility in international markets, while the achievement of primary surpluses and the gradual de-escalation of the public debt-to-GDP ratio reinforced investor confidence.
This progress does not mean that fiscal margins are limitless, this rather shows a fabricated storefront.
On the contrary, Greece still possesses one of the highest levels of public debt in the European Union, even if its structure is considered particularly favorable due to the long repayment duration and the low average interest rate.
The government seeks to maintain fiscal discipline, as it knows that the confidence restored after years of sacrifices cannot be taken for granted.
However, economic policy is called upon to confront a difficult dilemma: how large investments will continue once the Recovery Fund is completed.
The great gap after 2026
The NextGenerationEU was the largest joint investment program in the history of the European Union.
For Greece, it constituted perhaps the most important development tool since its entry into the Eurozone.
Through the Recovery Fund, projects of digital transformation, energy upgrading, modernization of the public sector, private investments, transport, and green development are financed.
The mobilization of private funds through the loans of the mechanism created an investment environment that could hardly be achieved solely with national resources.
However, the program is concluding.
From 2027 onward, Europe will need to decide whether it will continue to finance joint investments or if it will return exclusively to the logic of national budgets.
For Greece, the question is critical.
Needs are not decreasing, on the contrary, they are increasing.
The upgrading of electrical grids, interconnections with neighboring countries, investments in renewable energy sources, artificial intelligence, cybersecurity, railway infrastructure, water resource management, and adaptation to climate change require significant financial resources.
The "frugals" of the North and the logic of fiscal discipline
The greatest resistance against a new joint borrowing originates from the countries often called "frugal": Germany, the Netherlands, Sweden, Austria, and Finland.
Their argumentation is not groundless.
The governments of these countries argue that they borrow more cheaply than the European Union itself and, therefore, have no reason to assume the additional cost of a new joint borrowing.
Furthermore, they consider that the previous program created obligations that will burden European taxpayers for decades.
At the same time, they invoke the weaknesses of the Recovery Fund.
The European Court of Auditors has pointed out delays in disbursements, difficulties in assessing the real effectiveness of the projects, incomplete data regarding the final recipients of the funds, and weaknesses in control mechanisms.
These objections cannot be ignored, and particularly in relation to Greece with the massive problem of clientelistic relations and the rule of law.
The complaints of the European Public Prosecutor's Office regarding the management of resources reduce international confidence in the Greek economy.
Fiscal responsibility constitutes a basic prerequisite for maintaining the credibility of the European Union and its member states.
The real dilemma of Europe
The discussion on common debt is no longer the same as that of the debt crisis period.
Then, the focus was the fiscal rescue of states with excessive deficits. Today, the focus is the financing of European competitiveness, and without borrowing this cannot happen, the USA utilize the massive power of the dollar system to accumulate investments in domestic assets, a capability that Europe does not possess.
The United States are investing massively through industrial incentives, while China continues to support strategic sectors of its economy with state resources.
For Greece, such an approach would allow the continuation of critical investments without disrupting fiscal balance.
It would also reinforce the attractiveness of the country as an investment destination, as public investments often function as a lever to attract private funds, since net foreign direct investments find themselves in negative territory.
Current tools are insufficient
Europe is called upon to decide whether it will be able to respond to this competition with existing fiscal tools or if a new form of joint financing is required.
The answer can be neither unconditional fiscal relaxation nor the absolute denial of any joint borrowing.
The challenge is to create a framework that will combine strict rules of transparency and evaluation with the capability to finance investments of strategic importance.
The Greek bet of the next decade
Greece has covered a long distance since the period of the crisis.
Fiscal stability constitutes a valuable asset now that must not be placed at risk.
At the same time, however, the country cannot suspend the investments required to increase productivity, reinforce extroversion, and improve the standard of living of citizens.
The European discussion on common debt does not concern, therefore, the revival of confrontations between North and South.
It concerns whether the European Union will be able to finance its next developmental leap, without undermining its fiscal credibility.
For Greece, the answer to this question will determine to a great extent the growth capabilities of the economy after the end of the Recovery Fund.
The objective is not more borrowing for consumption, but better financing for productive investments.
This, however, clashes with the permanent deficit of productivity in the Greek economy.
It does not mean that Greeks do not work sufficiently in terms of quantity, but in today's environment, the production of value depends on a multitude of qualitative productive factors that our country does not possess: technology integration, capital support, an environment supportive regarding the assumption of investment risk, absence of bureaucracy and institutions of patronage, flexibility and dynamism regarding corporate culture.
It is trapped in an economic model of low productivity, hospitality services, cafés, restaurants, etc., and negative capital investments from which it does not seem to escape, and fatally, beyond the storefront, the conditions of economic decline are reproduced.
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