Allianz Trade has announced significant upgrades to its financial risk rating for 48 countries in 2024 - more than double the 2023 figure. This positive momentum, however, may be tested over the next two years, as geo-economic tensions are likely to hit business confidence and international trade.
The Greek economy continues to show resilience, with GDP expected to grow faster than the Eurozone average in 2025. Strengthening private consumption, combined with record tourism revenues of €22 billion in 2024, are fuelling this momentum.
At the same time, the country has achieved a significant reduction in public debt - from 209% of GDP in 2020 to 164% in 2023. This fiscal stability has led to successive upgrades of Greece's credit rating, after 13 years in the high risk zone. However, maintaining this upward trajectory requires strategic use of Next Generation EU (NGEU) resources and addressing structural weaknesses, while reducing dependence on tourism remains crucial.
International Image: Improving Risk, but Variable Environment
In 2024, a broad risk upgrade was recorded in 48 countries, with most positive changes in emerging markets. Latin America recorded the most upgrades (13 countries), followed by Eastern Europe (10 countries) and Asia-Pacific (9 countries). In contrast, the Middle East experienced more downgrades due to supply chain tensions and oil price pressures.
«Despite the current optimism, countries remain exposed to geopolitical and economic turbulence that could reverse this positive trend,» notes Luca Moneta, Senior Economist for Emerging Markets at Allianz Trade.
The Risk Remains: Uncertainty for 2025-2026
Although falling inflation and improving liquidity have strengthened the business environment, significant risks remain, especially for low-income countries and high-income economies facing political instability.
Aylin Somersan Coqui, CEO of Allianz Trade Group, warns that most risk upgrades are based on short-term indicators, which makes them potentially reversible. «Businesses need to maintain strategic vigilance as increasing geopolitical uncertainty and deteriorating trade relations will make supply chains more complex,» he notes.
The Biggest Threats to the International Economic Environment
Allianz Trade identifies the following factors that could disrupt the positive economic momentum over the next two years:
- Geopolitical tensions: Social and political conflicts escalated at the end of 2024.
- Risk of trade war: Increased protectionism may lead to new trade conflicts.
- Political unrest: Strong political polarisation in developed and emerging markets increases uncertainty.
Ana Boata, Head of Economic Research at Allianz Trade, he warns: «A full-blown trade war could drastically hit economic activity and reignite inflationary pressures, undermining investor confidence.» At the same time, growing social and political polarisation is putting strong pressure on public finances, increasing the risk of civil unrest.
In this uncertain context, policymakers and businesses need to carefully manage risk, adapting their strategies for an environment that remains fragile and challenging.