ATHENS – While Greece has gone from junk bond to investment grade status by ratings agencies, the country’s current account deficit is holding it back from obtaining a better debt rating, the Bank of Greece said.

The bank pointed to data in the first five months of 2024 that showed the deficit was 9.09 billion euros ($9.92 billion,) which was 23 percent higher than the 7.39 billion euros ($8.07 billion) in the same period in 2023.

Greece’s bonds were rated junk for 14 years during an economic crisis that required 362 billion euros ($395.13 billion) in international bailouts but came with brutal austerity measures that hit workers, pensioners and the poor.

The problem was attributed to a rise in the consumer goods deficit with exports falling and imports increasing, widening the trade imbalance but seen being corrected as summer tourism revenues will come in.

Greece relies on tourists as the biggest revenue engine and in a record 2023 year gained more than 20 billion euros ($21.83 billion) from more than 31 million tourists, expecting to surpass both in 2024.

But while the debt ratio to the Gross Domestic Product (GDP) has come down there are worries the debt burden could increase and put a dent in the hopes for even better credit ratings which entice foreign investors.

Carlo Capuano, chief Greece analyst for rating agency DBRS, told Kathimerini that while the deficit is a problem that it’s not affecting Greece’s competitiveness, although that has been lagging.

Other analysts said Greece’s recovery from the crisis that saw the economy shrink 25 percent before beginning to come back when the bailouts ended in 2018 has created a gap between domestic spending and production.

That has fueled worries that the country will fall back into its old ways of overspending and runaway patronage, decades of which created the crisis and led to the debt growing out of control.