The Paint Industry in Greece: Recovery, Challenges and Prospects for 2026

The production sector for paints, varnishes, and coatings — NACE 20.3 — is a vital part of the Greek chemical industry, contributing approximately 16% of the sector’s total turnover and 20% of employment in the domestic chemical industry.

The sector consists mainly of small and very small enterprises, while the number of active production units has declined sharply over the past decade. More specifically, the number of companies in the sector today is roughly half of what it was in 2010, having fallen from more than 100 to around 50 companies in 2023. This reflects both market consolidation and the exit of companies during the period of the economic crisis.

Despite these losses, the sector remains critical for the economy, supplying essential products to construction, industry, shipping, and other areas.

Recovery in Production and Stronger Export Orientation

The recovery of the sector has been slow but steady in the post-crisis period. It took twelve years for production to return to 2009 levels. This was finally achieved in 2024, when production volume increased by 9.1% compared with the previous year.

As a result, production returned to pre-crisis levels, supported to a large extent by the strong growth of exports. In 2024, exports are estimated to have accounted for 42% of the sector’s turnover — almost three times their share in 2010.

Greek paint companies have become much more outward-looking, taking advantage of neighbouring markets. The majority of exports are directed to countries such as Bulgaria, Romania, and Albania. This export profile played a decisive role in the sector’s recovery during the recession, acting as a counterbalancing mechanism when domestic demand was weak.

At the same time, the sector’s turnover followed an upward trend. In 2023, total company turnover reached approximately €603 million, recording growth in constant prices — in real terms — compared with previous years.

This 4.8% growth in 2023 compared with 2022, in real terms, reflects both increased production and improved prices, despite inflationary pressures. Nevertheless, turnover fluctuations remain dependent on the economic cycle and on the cost of raw materials and energy, underlining the cyclical nature of the sector and its vulnerability to external factors.

Economic Performance and Financial Indicators

The improvement in production activity is also reflected in the financial performance of companies in the sector. In 2023, profitability increased significantly: total earnings before interest, taxes, depreciation, and amortisation — EBITDA — rose to €86 million, from €68 million in 2022, while net profit after tax reached €50 million, compared with €38 million in the previous year.

In other words, net profits increased by approximately 32% in 2023, continuing the upward trend recorded during the period 2019–2023.

The overwhelming majority of companies are now profitable. Around 83% of companies recorded profits in 2023, compared with only around 43% in 2011. This turnaround is striking: in 2011, more than half of the companies were loss-making, whereas today eight out of ten have a positive result.

This indicates a broad improvement in the overall health of the sector, although performance varies depending on company size.

Differences by company size: medium-sized and large companies show stronger performance in terms of profit margins, while smaller companies face greater pressure.

The overall net profit margin after tax stood at 8.2% in 2023. However, for very small and small enterprises it was only 4.7% and 5.3% respectively. By contrast, medium-sized companies achieved a net margin of 9.3%, while large companies reached 8.4%, both above the sector average.

Small companies also show higher leverage. The ratio of liabilities to total capital reaches around 55% for small enterprises, compared with only around 35% for medium-sized companies. This means that smaller players rely more heavily on debt, a financial vulnerability that implies a higher cost of capital and greater difficulty in funding growth.

Nevertheless, liquidity remains generally strong. The current ratio has remained above 2 over time and stood at 2.5 in 2023, indicating that companies are comfortable in meeting their short-term obligations.

Medium-sized companies recorded the highest liquidity ratio, at 2.9, while large companies recorded the lowest, at 1.92. This is expected, as larger players tend to use their capital more intensively.

One worrying indicator is value added. The share of value added in turnover fell to 28.7% in 2024, from an average of 31.3% during the period 2010–2020. This means that there is relatively less remaining for wages, profits, and investment, suggesting shrinking margins and reduced capacity to reinvest earnings.

Key Financial Performance Indicators — 2023

Source: 2023 financial statements, IOBE processing.

The table highlights the gap between smaller and larger companies. Smaller enterprises underperform in terms of profitability and carry heavier debt burdens, while medium-sized and large companies achieve higher margins with relatively lower leverage.

Demand Drivers: Construction Activity and Renovations

Domestic demand for paints is directly affected by the construction sector and building renovation trends.

After a period of strong growth during 2020–2022, construction activity is now showing signs of fatigue. According to the latest available data, during the first four months of 2025, issued building permits — in terms of surface area — fell by 41% compared with the corresponding period of 2024.

The decline is even more pronounced in new residential buildings, where surface area decreased by 51%. If this trend continues, it poses a serious risk of slower demand for paints in 2026, given that construction is the main application market for architectural paints.

Forecasts for residential investment already reflect this increased uncertainty. An IOBE study presents two scenarios for 2026: an optimistic scenario, in which investment in new residential buildings remains around €5.8 billion, and a pessimistic scenario, in which it falls to approximately €5.3 billion.

Under the pessimistic scenario, the value of residential construction activity is expected to be 13% lower in 2026 compared with the optimistic scenario. This difference implies a significant loss of demand for paints and related building materials. Such a development would negatively affect both paint production and materials such as mortars.

In addition, household intention to renovate homes has weakened. The share of Greek households stating that they intend to repair or renovate their home within the next 12 months fell to 1.5% in 2024, from higher levels of around 3% or more in 2021.

This decline suggests a loss of momentum in the building paints market in 2025, as fewer private individuals are planning painting and maintenance works on their properties.

Overall, the short-term outlook for domestic demand appears moderate, with the main risk being stagnation or decline in construction activity during 2025–2026.

Supply-Side Challenges: Raw Material Costs and Supply Chains

On the supply side, the sector faces significant cost and supply challenges.

Greek paint production depends heavily on imported raw materials. Approximately half of the domestic market is covered by imports. In recent years, the prices of many key raw materials — resins, solvents, pigments, and others — have increased sharply, raising production costs and putting pressure on producers’ profit margins.

This pressure intensified during the pandemic and the energy crisis, as disruptions in global supply chains led to shortages and increases in freight and energy costs. In 2021–2022, the producer price index for paints increased significantly, while import prices also rose, although more moderately.

A new cost factor is the EU’s environmental tariffs on critical raw materials. Since the beginning of 2025, the European Commission has imposed tariffs of around 6% on imports of titanium dioxide — TiO₂ — from third countries, as well as anti-dumping measures.

TiO₂ is a key pigment for paints, and this regulation, within the broader context of “green protectionism” policies, increases production costs in Greece, reducing competitiveness against non-EU countries that are not subject to such tariffs.

The impact on paint companies’ costs is considered comparable to the increase in electricity costs for energy-intensive industrial sectors. It is also worth noting that the timing of these tariffs coincides with the closure of European TiO₂ and epoxy resin production plants, further intensifying the issue of secure supply from nearby sources.

In addition, the sector is facing increasing competition from low-cost countries. Imports of finished paint products are rising from countries such as Turkey, where producers are not subject to the same environmental restrictions and tariffs, thereby gaining a cost advantage.

High import penetration — around 50% of the market — remains a long-standing feature, while the share of cheaper non-EU imports has recently increased. This creates strong competitive pressure for Greek production, particularly in standardised, general-purpose products.

Finally, geopolitical risks continue to threaten the smooth functioning of supply chains. A typical example is the ongoing crisis in the Red Sea region, which affects maritime transport.

This disruption has a dual impact: on the one hand, it delays the import of raw materials from Asian and African markets; on the other, it makes Greek exports to these regions more difficult.

The increased transport cost and uncertainty regarding delivery times cause production disruptions and further burden product distribution costs.

Green Transition and Future Trends

Despite the challenges, significant growth opportunities are emerging through the shift towards more sustainable and innovative solutions.

The European Union is strongly promoting “green” chemical products and the reduction of environmental footprints. The regulatory framework is becoming increasingly strict. Regulations such as REACH, covering chemicals, and the EU Taxonomy, covering sustainable economic activities, set higher standards for safety and environmental performance.

Greek paint companies are being called upon to innovate by developing new low-emission products, waterborne paints, and generally more ecological formulations in order to comply with these requirements.

Although compliance involves higher costs and investment — in digitalisation, R&D, and new equipment — it also creates new sources of competitive advantage for those who move quickly.

Consumer demand is also shifting towards more environmentally friendly products. Internationally, environmental regulations are driving growing interest in VOC-free coatings and new materials that offer durability with a lower environmental impact.

The global outlook for the sector remains positive. According to recent market studies, the global paints and coatings market is expected to grow from approximately $194.5 billion in 2024 to around $227.5 billion by 2029, with a compound annual growth rate of 3.2%.

The strongest growth is coming from the Asia-Pacific region, but mature markets such as Europe and North America are also expected to show more moderate but steady growth, driven by renovation activity and industrial demand.

In Europe, the Middle East, and Africa — EMEA — the paints and coatings sector is estimated at around €57–58 billion per year and is expected to grow at a CAGR of approximately 2% over the next five years.

Greece, although a small market in absolute terms, is aligned with this trend. The Greek paint market is estimated to reach approximately €693 million in 2024 and to grow at a compound annual rate of around 2.4% through 2031.

In other words, moderate long-term growth is expected, reflecting the recovery of construction and industry. The fact that the Greek growth rate is close to the European average of 2.1% indicates that the market has room for expansion, provided that opportunities are properly utilised.

The key areas where demand is expected to emerge are, on the one hand, construction and real estate — new buildings, renovations, and energy upgrades of buildings — and, on the other hand, the industrial sector, including marine coatings, coatings for metal structures, and even the automotive sector in repairs or spare parts.

Specific programmes such as government subsidies for residential energy upgrades — for example, “Exoikonomo” — or tax incentives for renovations can provide a boost to paint consumption in the coming years.

At the same time, digitalisation of production and the adoption of advanced technologies — automated tinting, colour measurement, IoT for warehouse management, and others — will improve productivity and reduce costs, strengthening the competitiveness of Greek companies.

SWOT Analysis: Strengths, Weaknesses, Opportunities, and Threats

Strengths

The paint sector in Greece is an important part of manufacturing, with a strong recovery in production back to pre-crisis levels.

Exports have increased dramatically, reaching 42% of turnover in 2024, indicating that Greek companies have gained market shares in regional markets.

Employment in the sector has increased in recent years, and labour productivity is higher than the manufacturing average, demonstrating skilled human resources and technical know-how.

Overall profitability is improving, with eight out of ten companies now profitable, reflecting economic recovery and better sustainability prospects.

Weaknesses

The sector is still dominated by small production units with a limited capital base.

Small and very small enterprises record low profit margins, around 4–5%, and high leverage, making them more vulnerable to financial risks.

Dependence on imported raw materials — with import penetration of around 50% — creates vulnerability to supply disruptions and exchange rate fluctuations.

The sector has also historically suffered from low investment intensity. Investment in fixed assets and R&D remains limited compared with other industrial sectors.

This restricts the adoption of new technologies and the development of innovative products, reducing future competitiveness.

Opportunities

The green transition and changing consumer preferences are creating new areas for growth.

Demand for eco-friendly paints — low-VOC and free from toxic substances — is continuously increasing, both in Greece and internationally.

EU programmes and national action plans offer financing tools for modernisation, digitalisation, and green innovation. This is an opportunity that Greek companies can use to upgrade their production.

The expected medium-term recovery of the construction sector, combined with infrastructure projects, building energy upgrades, and the renewal of the tourism product — hotel renovations, Airbnb properties, and similar activity — may generate additional demand for paints.

Furthermore, the potential entry of Greek companies into niche products, such as coatings for special applications — nanocoatings, antibacterial paints for hospitals, biocide-free marine coatings — or partnerships with neighbouring industries could open up new markets.

Threats

The decline in construction activity is an immediate risk for the sector. The sharp fall in building permits in 2025 points to weaker demand in 2026.

If uncertainty continues around urban planning issues and housing finance, the domestic market may stabilise or even shrink in the short term.

On the cost side, higher tariffs on key raw materials, such as TiO₂, and elevated energy costs more broadly are putting inflationary pressure on profit margins.

International competition is intensifying, with products from third countries — Turkey and Asia, among others — entering the market at very low prices, also taking advantage of favourable exchange rates or lower labour costs.

Geopolitical tensions — wars and trade disputes — continue to create risks of delays and shortages.

Overall, companies expect 2025 to be a difficult year. According to a business expectations survey, turnover is forecast to decline marginally by 0.8% compared with 2024, while net profits are expected to fall more significantly, by 9.4%.

This underlines that, despite the recovery, the sector is not immune to new waves of recession or external shocks.

Conclusions and Outlook

The picture that emerges is of a sector in transition.

The SWOT analysis confirms that there are real threats — from reduced construction activity and high raw material costs to intensifying non-EU competition and the pressures of compliance with new regulations.

At the same time, the sector’s strengths and new opportunities can serve as a springboard for further growth.

Greek paint companies have demonstrated resilience, recovering from a deep crisis and significantly improving their efficiency. Stronger exports and the adoption of innovation in sustainable chemistry products are key pillars on which they can build.

Looking towards 2026 and beyond, strategic adaptation will be decisive.

Companies in the sector need to invest in Research and Development for new products, improve their processes through digitalisation and automation, and focus on high value-added areas.

At the same time, the State can play a supportive role through appropriate incentives and financing, such as subsidies for green investments and tax relief for energy-efficient production units, in order to accelerate the sector’s transition into the new era.

A significant obstacle remains the shortage of specialised personnel with modern skills, which requires cooperation with the education system and training programmes.

Overall, the Greek paint industry appears to have the foundations needed to maintain and increase its contribution to the economy, provided it adapts successfully to changing conditions.

Flexibility, export orientation, and an emphasis on quality and innovation will be the keys to turning challenges into opportunities.

With the right planning, the sector can not only withstand turbulence, but also emerge stronger and more sustainable in the competitive international environment of the coming years.

References: IOBE Study, September 2025; IBISWorld; Cognitive Market Research; MarketsandMarkets; 6Wresearch.