Greece Calls for EU Fiscal Flexibility Amid Renewed Energy Crisis
Published on 01/10/2026 – 11:40 GMT+2
Greek Prime Minister Kyriakos Mitsotakis has urged the European Commission to take decisive action, granting national governments more fiscal flexibility to shield households and businesses from a significant rise in energy prices. This call comes in a letter seen by Euronews, highlighting the urgent need for support measures.
Mitsotakis emphasized the necessity for “breathing room” to protect Greek citizens and businesses, proposing adjustments to the Economic Governance Framework to allow for enhanced support without compromising fiscal sustainability. The letter, dated September 30, was addressed to Commission President Ursula von der Leyen and Eurogroup President Kyriakos Pierrakakis.
The Greek Prime Minister noted that Europe’s energy crisis is prolonged and worsened by escalating tensions in the Middle East, which jeopardize both economic and political stability in Greece. With the highest national debt among EU members, Greece’s growth is hampered by generous government subsidies and tax cuts aimed at mitigating the impact of rising costs.
To assist families in coping with climbing expenses, the Greek government is providing substantial cash aid for energy bills, fuel, and agricultural needs, alongside implementing tax cuts to stimulate business and win voter support ahead of the 2027 parliamentary elections.
The Energy Price Surge
Mitsotakis pointed out shocking price hikes since the conflict involving the US and Israel against Iran began on February 28, marking a stark increase in fuel costs. Gas prices have surged from just over €30/MWh to around €70/MWh, with electricity rates skyrocketing past €100/MWh in many EU countries.
Greece is proposing that certain temporary national measures to support consumers and companies be exempted from the EU’s net-expenditure indicator, allowing governments more leeway to subsidize aid without stringent EU constraints. This would enable them to account for additional VAT revenues resulting from inflation linked to energy prices.
The Greek leader anticipates discussions regarding these proposals at an upcoming energy ministers’ meeting in Brussels and at next year’s EU summit. His letter underlines a need for a broader approach beyond simply reducing energy demand, which has been predominantly suggested by the Commission.
Italian Prime Minister Giorgia Meloni echoed this sentiment on September 30, advocating for greater fiscal flexibility amidst Italy’s economic challenges.
In summary, Greece’s push for increased fiscal space comes at a critical time as EU countries grapple with escalating energy prices and the broader implications for affordability and economic stability.
