Major Boost to Greek Economy with Tourism and Urban Renewal

Jul 5, 2023

Italy’s Rizzani de Eccher teams up with Greece’s Avax to build the Vouliagnenis Mall Complex

By Federico Piazza


Taking advantage of Italian expertise, Southern Europe’s largest shopping mall will be built within the HellenikonMetropolitan Park — also known as the Ellinkinon — an urban reconversion project in a coastal area that covers over 6 km2.

Construction and tourism are driving Greece’s economic recovery following the challenging years of the sovereign debt crisis. The current general climate of confidence in the country is palpable. Certainly the recent elections, which reconfirmed the path taken by the conservative premier Kyriakos Mitsotakis as head of the government, indicates that the desire for continuity prevails when it comes to the policies aimed at consolidating public finances combined with revitalizing the national economy.

In this context, Greek tourism is expected to experience a record economic increase of 10% in 2023 compared to 2022. The sector had already recovered from a drastic drop due to Covid in 2020, generating €27 billion in 2021, even if that was still below the €38 billion recorded in 2019. Given its centrality to the country’s economy, tourism is the focus of a ten-year strategic investment plan (2021–2030). The retail and tourism-related construction sector (infrastructure and accommodations along with residential, sports, and leisure facilities) stands to benefit substantially over the next four years. In fact, according to the Greece Construction Market Overview 2024–2027, the entire Greek construction sector, which was worth $11.5 billion in 2022, will grow by an average of 2% per year.

In particular, among the most ambitious Greek real estate projects in the tourist-retail-residential sector, The Ellinikon urban renewal plan in the Attica region stands out. The project, spearheaded by Lamda Development, one of the largest Greek real estate development companies listed on the Athens stock exchange, has a value of €8 billion and covers an area of 6.2 km2 which also includes a decommissioned airport site facing the sea at Glyfada. The Ellinkinon will house a combination of residences, shops and offices as well as leisure, entertainment, and cultural facilities within the vast coastal park, which will be Europe’s largest.

Among the works scheduled to start construction this summer is the largest and most modern shopping center in Greece and one of the largest in Southern Europe, the 130,000‑m2 Vouliagmenis Mall Complex (VMC). The construction of the VMC will also have an Italian touch, given that the project involves the construction company Rizzani de Eccher S.p.A. which, in a joint venture with the Greek Avax S.A., will provide ECI (Early Contractor Involvement) services for the management and pre-construction of the complex.

Looking at the essential data relative to the Greek economy, the International Monetary Fund, the European Commission, and Greece’s Central Bank agree that the national GDP (which was $220 billion in 2022) will increase by more than 2% in 2023. Of course, in the current difficult international economic situation, this is a slowdown in growth compared to post-2020. However, Greece will still grow more than the EU average. In nominal terms, after reaching its lowest value since the 2008 crisis in 2020 ($188 billion), Greek GDP has been in a lively recovery for three years. And, forecasts for 2028 say that growth will continue until it reaches over $270 billion.

For a country that went bankrupt just over 10 years ago, the positive trend in the public debt to GDP ratio is very important. According to the EU Economic Forecast, the weight of public debt on national wealth will drop from 171.3% in 2022 to 160.2% in 2023, and to 154.4% in 2024. While the deficit to GDP ratio will decrease from 11.8% in 2022 to 9.2% in 2023 and 7.8% in 2023.

It is notable that unemployment is also declining. In 2018 it exceeded 19%, in 2021 it fell below 15%, in 2022 it was down to 12.5% and the EU Economic Forecast predicts 12.2% for 2023 and 11.8% for 2024.
Finally, with respect to the issue of inflation — which has troubledEurope for the last two years — Greece is expecting it to drop from 9.3% in 2022 to 4% in 2023 and 2.9% in 2024.



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