Greece. Greece’s debt crisis escalated during the year and in November forced the Social Democratic government under Giorgos Papandreou to resign and surrender to a unifying government under former governor Lucas Papademos. Concerns were affecting the entire world economy. Visit ABBREVIATIONFINDER for the acronym of GRC that stands for the country of Greece.
According to Countryaah official site, the Greek central government debt was estimated at 162% of GDP and the budget deficit for 2010 was larger than projected. According to Greece, the explanation was mainly reduced tax revenue due to income reductions and reduced consumption. The credit rating agencies have on several occasions lowered the country’s status to new bottom levels, all in the field “worthless”. Interest rates on the country’s commercial loans were pushed up to levels Greece could not possibly pay. The International Troika, the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF), therefore, prepared additional rescue packages following the € 110 billion promised in 2010 and partially paid out.
The counterclaims were harsh and the Greek Parliament voted through several radical austerity packages. Taxes were increased and tax legislation was tightened, wages in the public sector were reduced by at least 20% and many public employees were laid off from their jobs. But the troika found that it was not enough. Pensions were not lowered as promised, labor law was not sufficiently weakened and tax collection did not tighten. In addition, the privatizations of state-owned postal and telecommunications companies, ports, airports and other properties, which were intended to generate revenue of EUR 50 billion, did not go ahead. Sales were made more difficult by the fact that few buyers were interested in the often inefficient state companies. Within the PASOK government party, there was also resistance to selling state property and deteriorating conditions for public servants.
The cuts hit hard. Many Greeks could not afford to pay their bills. Schools and healthcare lacked resources. Drug abuse and crisis-related diseases such as AIDS, TB and hepatitis increased, as did the number of suicides. The resistance from the people was strong. Demonstrations regularly degenerated into violence. The school, healthcare, the banking sector, the media, the justice system and the electricity and water utilities were shaken by repeated strikes that paralyzed everyday life.
Papandreou announced on October 31 that the Greeks would have to decide on the loan terms in a referendum. His idea was that the austerity demands a popular anchorage, but the risk of a no was imminent. This would mean that the next payment was withheld, which would probably lead to the bankruptcy of Greece. The criticism of Papandreou was devastating both by eurozone leaders and the Greek opposition as well as by his own leaders, including from Finance Minister Evangelos Venizelos who had taken office as late as June.
Papandreou announced his departure on November 8. As his successor emerged Papademos, a partisan economist who was previously Governor of the ECB and Vice President of the ECB. His unity government with ministers from PASOK, ND and the right-wing LAOS was sworn in on November 11. The government promised that privatizations, cuts and tax collection would be stepped up in exchange for a payment of EUR 8 billion from a new rescue package totaling EUR 130 billion. International banks also promised to write off 50% of the Greek debt.
The Contemporary History of Greece
Greece’s contemporary history is the story after 2000. The beginning of the new millennium brought with it new challenges for Greece, most related to a downturn. From membership in the European Economic and Monetary Union to debt crisis and talk about possible Grexit , the challenges have led to increased poverty among the population and a stronger polarization between the right and left sides of politics.
New crisis loan and new election
A fifth negotiating party, the eurozone crisis fund The European Stability Mechanism (ESM), came in after the referendum. After several rounds of negotiations, in August 2015, all parties agreed on the terms of a new loan agreement of up to EUR 86 billion over the next three years.
On August 20, 2015, Prime Minister Alexis Tsipras decided to step down, triggering new elections. A week later, Supreme Court Judge Vassiliki Thanou was appointed interim prime minister. Thanou became the first female prime minister in Greece.
On September 20, SYRIZA won another victory, and Tsipras was mandated to start his second term as prime minister.
During the summer of 2015, the refugee crisis in the Mediterranean escalated. Due to its geographical position, Greece is characterized as the “gateway to Europe”, and many refugees choose the sea route across the Aegean Sea to reach Greece and Europe. Most refugees come from war-affected countries such as Afghanistan, Syria and Iraq.
According to the United Nations High Commissioner for Refugees (UNHCR), 856 723 refugees arrived by sea in Greece during 2015. In October alone, nearly 210,000 new arrivals were registered, most of them on the island of Lesbos.
In March 2016, Turkey and the EU agreed on a “one-on-one” solution for returning refugees. The Refugee Agreement meant that all refugees and migrants arriving in Greece from Turkey after March 20, 2016 should be sent back to Turkey, with the EU picking up a similar number of Syrian refugees from Turkey and settling them in Europe.