Greece has announced a €300 million ($345 million) relief plan in an attempt to shield households and businesses from the economic pressures triggered by the fuel crisis linked to Middle East tensions. Prime Minister Kyriakos Mitsotakis presented the package as an immediate national response while Athens continues to push for a broader European strategy.
The measures will cover April and May and, according to the government, will benefit almost the entire population. Mitsotakis said Greece remains at the forefront of efforts to shape a unified European response but stressed that the government will also move on its own at the national level when necessary.
Greece targets fuel, farming, and transport costs
The package includes four measures aimed at containing the impact of higher energy and transport costs across the economy. Firstly, the government will subsidize road diesel across the distribution network by sixteen euro cents per liter. With VAT included, that translates into a final reduction of twenty cents per liter at the pump.
Moreover, the government will introduce a Digital Fuel Card to help consumers cope with rising gas prices. Drivers will be able to use the card at fuel stations, while it will also apply to public transportation, including taxis. Support is estimated at an average of 36 cents per liter. Based on a monthly consumption of seventy liters, the benefit will amount to €50 every two months for people living on the mainland and €60 for island residents.
Third, the Greek government will support farmers facing a sharp rise in fertilizer costs. Under the plan, it will cover fifteen percent of the value recorded on their purchase invoices.
Lastly, Athens will compensate ferry operators in exchange for mandatory ticket discounts. That step aims to keep ferry fares at last year’s levels and prevent another increase in travel costs.
Greece’s relief funding plan within fiscal limits
PM of Greece Mitsotakis has said public funds will cover the cost of the package alongside revenue from a tax on profits generated by online gambling operators providing casino-style games. That tax is expected to secure €100 million ($115 million).
At the same time, the PM asserted that the package remains fully compatible with prudent fiscal policies and measures strengthen social protections during a volatile period without jeopardizing the economic progress Greece has made in recent years. He also emphasized that reserves will be kept in place in case the global economic environment deteriorates further.
Opposition slams fuel measures as inadequate, proposes four-point relief plan
The opposition expressed strong critisim with the main conclusion being that the measures are deemed inadequate and lacking a clear strategic direction.
SYRIZA leader Socrates Famellos stated that the government avoids intervening in the fuel sector, citing the influence of powerful interests.
In contrast to the government’s measures, the opposition proposed a package of four immediate interventions aimed at relieving citizens.
- First, it calls for a reduction of the Special Consumption Tax to the lowest level allowed by the European Union, estimating that this would provide significantly greater benefits to consumers compared to current measures. Indicatively, it is suggested that a worker could benefit by up to 160 euros over two months, compared to approximately 50 euros under the government’s policies.
- Second, it proposes the suspension of VAT on basic food items, along with the establishment of permanent reductions on the islands, in order to address the higher cost of living.
- Third, it advocates for substantial intervention in the refinery sector by imposing a profit cap—specifically at 8 dollars per barrel—to curb excessive profiteering without undermining business viability.
- Finally, the opposition proposes the imposition of price caps and strict controls across the entire supply chain, from production to retail, with the aim of protecting both consumers and producers from unjustified price increases.
Government links Greece relief plan to regional instability
The Greek PM directly linked the package to the broader geopolitical crisis and its consequences for the Greek economy, stressing that from the outset of the Iran conflict, the government had engaged actively on both diplomatic and economic fronts.
Mitsotakis stated that Greece moved swiftly to assist Cyprus, maintain regional stability, and secure energy supplies across the wider area. He added, however, that external instability also demands domestic measures, particularly since rising fuel costs affect production, consumer prices, and the daily budgets of both households and businesses.