Situacion economica de grecia

The inconsistencies that were predicted by many economists when the euro was introduced, but were masked by the favourable economic situation between 2000 and 2008, have now come to light with theproblems in Greece.

As the European Central Bank’s monetary policy is essentially based on the economic situation of the “large countries”, and more specifically, Germany and France, the SouthernEuropean countries' membership of the euro has enabled them to enjoy much lower interest rates than those to which they were accustomed when they had their own currencies. The authorities in SouthernEurope have not taken advantage of these rates to reduce their debt – Greece, for example, continues to record an annual budget deficit of more than 5% despite growth rates well above the average forthe eurozone (on this note, one could also speculate about the reliability of Greece’s economic data as the government has just revised the deficit for the 2009 fiscal year upwards from 6% to 13%).The low level of interest rates has also given rise to excessive consumption and favoured the appearance of speculative bubbles (credit, housing, etc). Between 2000 and 2007, unit labour costs (outputper worker per hour worked) rose by around 20% in Italy, Spain, Greece and Portugal, while in Germany, there was no change. The resulting excessive consumption and negative trends in labour costs ledto the appearance of increasingly high external deficits. In 2008, Greece’s current account deficit was around 15% of gross domestic product. In terms of competitiveness, Greece has fallen to 71stplace in the World Economic Forum index, below countries like Botswana. The fact that labour costs and the current account balance are not part of the convergence criteria set out in the MaastrichtTreaty is one of the euro’s major weaknesses. This weakness is further accentuated by the lack of automatic transfer mechanism between countries in the eurozone, which contrasts with the situation...