Why greece went bankrupt

The final bailout came to a formal end about a year ago - in the sense that the payments to Greece have stopped. But the repayments will take decades. The final one, on the current schedule, is due in August Economic activity in Greece is still only three quarters of its peak before the crisis. The labour market also stands out as the EU's most troubled. The percentage of the working age population who have jobs is the EU's lowest. The annual deficit in the government finances is far down from the peak.

The cost of servicing the mountain of Greek debt could be a lot worse, as the interest rates on loans from governments are low.

Greece has now returned to the financial markets to meet its further borrowing needs, and the costs it faces there are also modest compared with those faced at the height of the debt crisis. However, whoever emerges as winner from the election will have their work cut out getting Greece properly back on its feet.

Sophie Lamprou says work will continue on Impact Hub no matter what happens. However, she adds: "Of course we are positive. If not, we wouldn't insist on continuing in what we do, being conscious that we are in an environment that can't give guarantees.

After looking over the abyss, coming perilously close to crashing out of the euro, seeing their national income slashed by austerity-driven recession, their unemployment rate skyrocket, their brightest and best leave, Greeks had come through the worst. The ordeal by bankruptcy was over. Denouement has come with a whimper. Under the crystal chandeliers and portrait-heavy walls of the meeting room, there is little sign of jubilation.

In the building whose cliffhanger votes punctuated the crisis, is there really nothing to celebrate? Our creditors are not going away. Psychologically that is not insignificant three years before Greece marks the th anniversary of the start of the war of independence from the Ottoman empire. In global financial history no country has received as much money as Greece. Rescue has come at a price.

The conditions attached to such aid have been tough, unpopular and, at times, punitively aggressive. But the fiscal straitjacket has also stifled economic growth. In his seventh-floor office, the airconditioners whirring, he momentarily pauses. But the result was the implosion of the Greek economy. Still, the academic who previously advised presidents of the European commission and European council, is like Theocharis, incredulous that democracy has fared as well as it has.

Thugs may have appeared in the form of the far-right Golden Dawn , polarisation may have worsened and discourse coarsened, but institutions remained intact. Apply market research to generate audience insights. Measure content performance. Develop and improve products. List of Partners vendors. In , Greece defaulted on its debt. Greece joined the Eurozone in , and some consider that the Eurozone partly to blame for Greece's downfall.

However, the Greek economy was suffering structural problems prior to adopting the single currency, and the economy was left to collapse—although not without its reasons. During the s, the Greek government had pursued expansionary fiscal and monetary policies. However, rather than strengthening the economy, the country suffered soaring inflation rates, high fiscal and trade deficits , low growth rates , and exchange rate crises.

The belief was that the monetary union backed by the European Central Bank ECB would dampen inflation, help to lower nominal interest rates , encourage private investment, and spur economic growth. Further, the single currency would eliminate many transaction costs , leaving more money for the deficit and debt reduction.

However, acceptance into the Eurozone was conditional. Of all the European Union EU member countries, Greece needed the most structural adjustment to comply with the Maastricht Treaty guidelines. For the remainder of the s, Greece attempted to get its fiscal house in order to meet these criteria. While Greece was accepted to the EMU in , it did so under false pretenses, as its deficit and debt were nowhere near within the Maastricht limits. Greece was hoping that despite its premature entrance, membership to the EMU would boost the economy, allowing the country to deal with its fiscal problems.

In , the Greek government openly admitted that its budget figures had been doctored to meet the entry requirements for the Eurozone's single currency. Suddenly, Greece was perceived as a safe place to invest, which significantly lowered the interest rates the Greek government was required to pay. Many are skeptical. Dimitris Charalambis, a political scientist who recently retired from the University of Athens after 35 years of teaching, knows austerity all too well.

His salary shrunk by 40 percent. The future feels gloomy, some say, because of the June agreement between Greece and its creditors. The Mediterranean country will have to achieve a 3.