Greece is eurozone's top Q3 performer ©Charlie Bibby Shoppers in central Athens, Greece After years as Europe's economic basket case, Greece has found itself in an unfamiliar position: star performer. On Friday the country reported the eurozone's highest economic growth in the third quarter thanks to a record summer tourist season, raising hopes it is heading for a sustained recovery after almost six years of recession. Output rose by 0.7 per cent in the three months to September, after expanding 0.4 per cent in the second quarter, according to a seasonally adjusted flash estimate by Elstat, the country's independent statistical agency. Greece is now on track to surpass this year's 0.6 per cent growth target, said Platon Monokroussos, chief market economist at Eurobank in Athens. "We're convinced that full-year growth will exceed the target and could reach 1 per cent," Mr Monokroussos said. Confidence in the economy is returning. The new quarterly figures, confirmed by Eurostat, the EU statistics agency, showed that Greece emerged from recession by March, three months earlier than previously thought, with output expanding by 0.8 per cent. Greece's new position at the head of the class also reflected the weakness elsewhere in the eurozone, with Germany and France barely managing to grow during the quarter and Italy's economy contracting. In Athens, reaction to the figures was more cautious than celebratory. The outlook remains uncertain, and Greeks are still reeling from the country's longest recession since the second world war, which took a heavy toll on a vulnerable economy based on tourism, shipping and other services with only limited exports of manufactured goods. It wiped 25 per cent off national output and pushed more than 35 per cent of Greeks below the poverty line, as successive governments enacted stifling austerity measures in return for a €230bn bailout by the EU and International Monetary Fund. Although still high, the jobless rate declined to 25.9 per cent in August from 27.3 per cent in April as seasonal work picked up in tourism and construction of infrastructure projects backed by EU funding stepped up. The surge in visitor arrivals fuelled an increase in retail sales and also spurred investment related to the sector, said Michael Masourakis, chief economist at Alpha Bank in Athens. "The third quarter saw a strong performance in private consumption while capital investment has been increasing steadily all this year, for example in car rental fleets and buses for the tourist industry," Mr Masourakis said. The economy is projected to grow by 2.9 per cent in 2015 following Greece's exit in December from a tightly monitored bailout programme that would be replaced by a precautionary credit line being negotiated with international lenders. But the growth target is likely to be revised downwards to 2.5 per cent to reflect mounting political uncertainty, with a snap general election probable next March if parliament fails to elect a new head of state with an enhanced majority. Opinion polls give the radical opposition Syriza party a strong lead but still leave it short of an outright parliamentary majority, pointing to a period of coalition government and slippage in implementing further economic reforms. "The economic fundamentals are quite robust - a trend of positive growth, a primary budget surplus [before debt repayments] and a current account surplus - but political considerations have become an issue," Mr Masourakis said.