Rae Hoff
Sep 4 · Last update 5 mo. ago.
Will Greece's economy fail again after pulling out of the bailout?
With Greece's recent pullout of the economic bailout, already some problems are occurring. Just today- the Ferry worker's have begun a strike for increased wages.
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Greece need to also pull out of the euro currency also to save either economy
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Greece will inevitably bounce back after pulling out of such an unfair bailout
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Regardless of the bailout, if Greece is to recover they will need to fix their own problems
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Greece need to also pull out of the euro currency also to save either economy

The problem with the EU bailouts following the economic crisis of 2008 is that there is a central bank trying to artificially regulate one currency for multiple markets, that should arguably function with multiple currencies. As currency is a store/measure of economic value the fact that most countries in the eurozone have very distinct markets, but use the same currency with no option to devalue means that most countries in the EU are under the thumb of the European Central Bank. This has lead to unfair economic bailouts being thrust on Greece and other countries, with more focus being placed on bankers making a profit from the situation, rather than a feasible deal with lending rates that’s benefit the affected countries.

The International Monetary Fund was an early party to notice the bailout of Greece was not working as intended, and as it is responsible for member nations not their unions, it spoke out against these measures as early as 2012. The IMF then began to distance itself from the "counterproductive set of austerity measures imposed on the country under the insistence of the EU” [1]. As the IMF makes funding available to buffer economic crises, allowing nations to correct economic mistakes without resorting to measures that threaten national or international prosperity, they could not condone these measures. But as Greece will be under performing in Germany and the EU’s eyes for some time to come, arguably the IMF should also facilitate Greece in leaving the eurozone and reinstate its own currency, as the Euro may be a threat to Greek prosperity also. [1] morssglobalfinance.com/reviewing-the-imfs-role-in-the-greek-crisis-what-its-independent-evaluation-office-missed

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Daniel Halliday
Dec 11
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DH edited this paragraph
The International Monetary Fund was an early party to notice the bailout of Greece was not working as intended, and as it is responsible for member nations not their unions, it spoke out against these measures as early as 2012. The IMF then began to distance itself from the "counterproductive set of austerity measures imposed on the country under the insistence of the EU” [1]. As the IMF makes funding available to buffer economic crises, allowing nations to correct economic mistakes without resorting to measures that threaten national or international prosperity, they could not condone these measures. But as Greece will be under performing in Germany and the EU’s eyes for some time to come, arguably the IMF should also facilitate Greece in leaving the eurozone and reinstate its own currency, as the Euro may be a threat to Greek prosperity also. [1] https://www.morssglobalfinance.com/reviewing-the-imfs-role-in-the-greek-crisis-what-its-independent-evaluation-office-missed/
Greece will inevitably bounce back after pulling out of such an unfair bailout

Greece fulfilled its European Stability Mechanism program, capping public sector contracts, cutting social security spending, and changing labour laws, declaring an end to the bailouts on 20th August 2018. Germany wanted austerity measures to carry on even though they have been proven to have contributed to a slow recovery after the Great Recession. But with the easing of austerity measures and the renewed ability to buy debt at regular rates Greece will be able to borrow, invest and recover in a similar way to the rest of Europe.

The post-Brexit European Union needs to realise that if it is to succeed, they need to form a supportive and flexible interdependence, otherwise other countries may default debt repayments in hard times, leading to conditioned lending and public sentiment will become increasingly anti-EU. Without some level of understanding from European Central Bank and other states the EU runs the risk of becoming increasingly fractious. With this environment of support and continued economic reforms on the part of Greece the country has already showed some signs of, albeit small, recovery. truthout.org/articles/eus-debt-deal-is-kiss-of-death-for-greece theguardian.com/world/2017/jun/22/greek-debt-imf-eu-bailout ft.com/content/3067bf9c-8a88-11e8-bf9e-8771d5404543

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Daniel Halliday
Dec 11
Approved
DH edited this paragraph
Greece fulfilled its European Stability Mechanism program, capping public sector contracts, cutting social security spending, and changing labour laws, declaring an end to the bailouts on 20th August 2018. Germany wanted austerity measures to carry on even though they have been proven to have contributed to a slow recovery after the Great Recession. But with the easing of austerity measures and the renewed ability to buy debt at regular rates Greece will be able to borrow, invest and recover in a similar way to the rest of Europe.
Regardless of the bailout, if Greece is to recover they will need to fix their own problems

Even before joining the EU and adopting the Euro, Greece had many substantial problems, unemployment, corruption, bureaucracy, an inefficient public sector, tax evasion and low global competitiveness. These are all problems "made in Greece" and will need Greek solutions, any bailout was arguable to stabilise the EU and its currency more than to help the Greek economy. Greece’s economic recovery will also need further home grown social and economic solutions to these problems if it is going to avoid future failure.

If Greece has any hope of paying back their over €300 billion debt, one starting point should be dealing with the huge issue of Greek tax evasion. With a yearly €5 billion missing just from VAT, and further billions thought to be invested in Swiss banks, studies have estimated the Greek economy is losing up to €16 billion a year just through tax avoidance alone. The government have already introduced new measures to fight this, from specialised screening software to requesting account deals from the Swiss banks. But this is such a large amount of money to be leaving the economy illegally, getting tough of tax fraud would go some way to not only pay back the bailout but so fix there economic misfortunes in the long run. transparency.org/research/cpi/cpi_2008/0 nationaldebtclocks.org/debtclock/greece

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Daniel Halliday
Dec 11
Approved
DH edited this paragraph
If Greece has any hope of paying back their over €300 billion debt, one starting point should be dealing with the huge issue of Greek tax evasion. With a yearly €5 billion missing just from VAT, and further billions thought to be invested in Swiss banks, studies have estimated the Greek economy is losing up to €16 billion a year just through tax avoidance alone. The government have already introduced new measures to fight this, from specialised screening software to requesting account deals from the Swiss banks. But this is such a large amount of money to be leaving the economy illegally, getting tough of tax fraud would go some way to not only pay back the bailout but so fix there economic misfortunes in the long run. https://www.transparency.org/research/cpi/cpi_2008/0 https://www.nationaldebtclocks.org/debtclock/greece
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