Greece: A Classical Example of Failure to Join the Eurozone

Petre Prisecaru

Revista de Economie Mondiala / The Journal of Global Economics, 2015, vol. 7, issue 2

Abstract: After the financial crisis Greece has received from Troika 240 billion euro within the two economic adjustment programmes between 2010 and 2014, most of the money coming from European Financial Stability Facility. The austerity policy imposed to Greece led to the decrease of deficits based on tax increases, wages and pensions cuts, unemployment rising, but also to a significant decrease of GDP by 25% in 2009-2013 period. The austerity and recession caused a huge public discontent and a prolonged political instability and finally the radical left wing coalition-Syriza- won the elections in 2015 and this brought a political blockage in the negotiations with Troika and to the prospect of a true Grexit, because Greece is practically a bankrupt state with a poor governance, not being able to pay its enormous debt (320 billion €) and to provide enough incomes for its budget.

Keywords: debt crisis; adjustment; recession; austerity; reforms; bankruptcy; debt payments; Troika; Grexit (search for similar items in EconPapers)
JEL-codes: D73 F53 G33 H12 H60 H63 (search for similar items in EconPapers)
Date: 2015
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