Greek Crisis

In: Business and Management

Submitted By aamirmalkani
Words 1048
Pages 5
Gee Case Memo 3:
The Greek default is not a current issue, as it has been in the making

Summary:
In the wake of events that followed the Global Financial Crisis, the EU was facing its toughest time since its inception, and a major catalyst to these problems was Greece. There were major speculations about a possible default on behalf of Greece, which would create a domino effect and take down a number EU members along with it and the EU could in no way let that happen. But Greece’s problems were not current. A series of events that had been occurring ever since the 1980’s eventually lead to the position Greece is in today and major bailout plan was needed, immediately.

Economic events that lead to Greece’s current state:
Beginning in the 1980’s, the situation of Greece had already started deteriorating, economically. Many of these occurring’s are what can be attributed to, as being one of the few primary reasons for the current state of Greece.

* With the trade balance increasing from -6.7% between the years 1975-79 to -7.9% in 1985-89 and finally touching -10% in 1990-94 and then averaging to -9.5% from 2001 through 2009, things had already started looking bleak for Greece. (Exhibit 4) * In addition to that, the Real GDP growth reduced from 8.5% in 1960-69 to -0.2% in 1980-84 and then averaging to a 2.45 % up till 2009, never to touch its golden ear of the 1960’s * Between the 1980’s and 1990’s the public debt as a percent of GDP almost tripled from a 28% to a whopping 89% * With the advent of the Global financial crisis, only to make matters worse, Greece’s two majorly lucrative industries, shipping and tourism were hit pretty bad which took unemployment levels to almost 20% in 2008

The Government and the people:
To a very large extent, Greece’s current state can be traced back to its own people’s doings. Right from the government to…...

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