In Tehran, Iran, an anti-Israel billboard featuring a picture of Iranian missiles has been discovered on a street. Meanwhile, in Greece, the economy is facing challenges both domestically and externally. The country’s demographics, climate change, and investment gap with Europe are all contributing to its ongoing struggles.

The strengthening of geopolitical tensions is adding another layer of uncertainty to the situation. The weak growth of major economies in Europe, which Greece relies on for investment, exports, and tourism, poses an additional challenge. There is a risk that new upward pressures on inflation will make the government’s forecast for growth of 2.9% this year seem unrealistic.

The external macroeconomic environment remains full of challenges as well, with increased security uncertainties and the possibility of an escalation of geopolitical tensions in regions like Ukraine and the Middle East. Spyridoula Tzima, deputy vice president of DBRS Morningstar rating agency, notes that an escalation of geopolitical tensions could lead to a rise in commodity prices and put upward pressure on prices. This could delay central banks’ decisions on interest rate cuts and require additional fiscal measures.

Global challenges such as monetary policy tightening and domestic events like reduced agricultural activity due to severe flooding have already affected economic activity in Greece. Maddalena Martini, a senior economist at Allianz, warns that weak global demand will create new challenges for growth in Greece this year. She expects GDP growth to reach only 1%, as the country has been impacted by a slowdown in its top export markets. However, Oxford Economics economist Paolo Grignani is slightly more optimistic