Greek Finance Minister and Eurogroup President Kyriakos Pierakakis warned that the current energy crisis could become one of the most severe global energy shocks in history. Speaking alongside Alfred Kammer, Director of the IMF’s European Department, at a public event hosted by the IMF headquarters, Pierakakis stressed that the severity and duration of economic fallout across Europe will hinge largely on how long volatility persists in international energy markets.
Targeted Support Amid Uncertainty
Pierakakis highlighted that the effects are already visible — in soaring energy prices and rising household costs. He underscored the importance of precisely targeting support measures toward the most vulnerable households, noting that effectiveness depends on allocating limited resources wisely amid ongoing uncertainty. ‘We must do everything we can to support primarily the most vulnerable,’ he said.
Referring specifically to Greece, he pointed out that the government has implemented focused interventions — including fuel subsidies for households and targeted business support — while avoiding broad, non-targeted tax cuts that would leave a more lasting fiscal footprint. A new package of support measures is currently under consideration for the next two months.
On cost, Pierakakis noted that current support measures amount to roughly 0.2% of GDP — significantly lower than the ~2.5% deployed during the 2022 energy crisis. In this context, he emphasized the challenge facing governments: balancing fiscal discipline with urgent social protection, especially amid economic uncertainty, rising interest rates, and high public debt.
Europe’s Growing Resilience — and Remaining Vulnerabilities
Pierakakis observed that Europe appears more resilient today than during the 2022 crisis, thanks to greater diversification of energy sources and infrastructure investments made since then. However, he cautioned that Europe still imports about 57% of its energy — leaving its economy exposed to external shocks.
This dependency, he argued, makes accelerating investment in grids, storage systems, and cross-border energy interconnections imperative. He also stressed the strategic importance of advancing energy integration across the continent, stating: ‘Driving forward a full Energy Union in Europe will deliver immediate and positive impacts — not only for energy security, but for overall competitiveness.’
He added that renewables now account for 47% of electricity generation in the EU — a significant milestone. Yet he cautioned that this progress does not eliminate the need for continued infrastructure investment to ensure reliability, scalability, and system-wide integration.