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Do not fill this in! === Debt crisis (2010β2018) === {{Main|Greek government-debt crisis}} [[File:Greek debt and EU average since 1977.png|upright=1.4|thumb|Greece's debt percentage since 1977, compared to the average of the [[eurozone]]]] The economy had fared well in much of the 20th century, with high growth.<ref name="Debt Past">{{cite news|title=2010β2018 Greek Debt Crisis and Greece's Past: Myths, Popular Notions and Implications |url =https://www.academia.edu/37583185 |publisher=Academia.edu |access-date=14 October 2018}}</ref> However, leading up to the [[2007β2008 financial crisis]], it had high structural [[Government budget balance|deficit]]s, and maintained a public [[debt-to-GDP ratio]] of about 100%.<ref name="Debt Past"/> In 2009, it was revealed deficits had for years been considerably higher than official figures.<ref name=":3" /> Banks had developed products which enabled the governments of Greece and other countries to hide their borrowing levels.<ref name="Europe derivatives 2">{{Cite news |date=19 February 2010 |title=Greece is far from the EU's only joker |work=Newsweek |url=http://www.newsweek.com/blogs/wealth-of-nations/2010/02/19/greece-is-far-from-the-eu-s-only-joker.html |access-date=16 May 2011}}</ref><ref>{{Cite news |date=September 2005 |title=How Europe's governments have enronized their debts |work=Euromoney |url=http://www.euromoney.com/Article/1000384/BackIssue/50007/How-Europes-governments-have-enronized-their-debts.html |access-date=1 January 2014}}</ref><ref name="Goldman">{{cite web |title=Greece Paid Goldman $300 Million To Help It Hide Its Ballooning Debts |url=http://www.businessinsider.com/henry-blodget-greece-paid-goldman-300-million-to-help-it-hide-its-ballooning-debts-2010-2 |url-status=dead |archive-url=https://web.archive.org/web/20100420053023/http://www.businessinsider.com/henry-blodget-greece-paid-goldman-300-million-to-help-it-hide-its-ballooning-debts-2010-2 |archive-date=20 April 2010 |access-date=6 May 2010 |website=[[Business Insider]]}}</ref> Banks supplied cash in exchange for future payments by the governments; in turn the liabilities of the countries were "kept off the books".<ref>{{cite news |author=LOUISE STORY |author2=LANDON THOMAS Jr |author3=NELSON D. SCHWARTZ |date=13 February 2010 |title=Global Business: Wall St. Helped to Mask Debt Fueling Europe's Crisis |newspaper=[[The New York Times]] |url=https://www.nytimes.com/2010/02/14/business/global/14debt.html |quote=In dozens of deals across the Continent, banks provided cash upfront in return for government payments in the future, with those liabilities then left off the books. Greece, for example, traded away the rights to airport fees and lottery proceeds in years to come.}}</ref><ref name="Bloomberg">{{cite news |author1=Nicholas Dunbar |author2=Elisa Martinuzzi |date=5 March 2012 |title=Goldman Secret Greece Loan Shows Two Sinners as Client Unravels |publisher=Bloomberg L.P. |url=https://www.bloomberg.com/news/2012-03-06/goldman-secret-greece-loan-shows-two-sinners-as-client-unravels.html |quote=Greece actually executed the swap transactions to reduce its debt-to-gross-domestic-product ratio because all member states were required by the Maastricht Treaty to show an improvement in their public finances," Laffan said in an e-mail. "The swaps were one of several techniques that many European governments used to meet the terms of the treaty."}}</ref><ref name="The Guardian">{{cite news |author=Elena Moya |date=16 February 2010 |title=Banks that inflated Greek debt should be investigated, EU urges |newspaper=[[The Guardian]] |url=https://www.theguardian.com/business/2010/feb/16/greek-debt-goldman-sachs |quote="These instruments were not invented by Greece, nor did investment banks discover them just for Greece," said Christophoros Sardelis, who was chief of Greece's debt management agency when the contracts were conducted with Goldman Sachs.Such contracts were also used by other European countries until Eurostat, the EU's statistic agency, stopped accepting them later in the decade. Eurostat has also asked Athens to clarify the contracts.}}</ref> These conditions enabled Greece to spend beyond its means, while technically meeting the deficit target in the [[Maastricht Treaty]].<ref name="Der Spiegel">{{cite news |author=Beat Balzli |date=8 February 2010 |title=Greek Debt Crisis: How Goldman Sachs Helped Greece to Mask its True Debt |newspaper=[[Der Spiegel]] |url=http://www.spiegel.de/international/europe/greek-debt-crisis-how-goldman-sachs-helped-greece-to-mask-its-true-debt-a-676634.html |access-date=29 October 2013 |quote=This credit disguised as a swap didn't show up in the Greek debt statistics. Eurostat's reporting rules don't comprehensively record transactions involving financial derivatives. "The Maastricht rules can be circumvented quite legally through swaps," says a German derivatives dealer. In previous years, Italy used a similar trick to mask its true debt with the help of a different US bank.}}</ref><ref name="Goldman" /><ref>{{cite news |author1=Story, Louise |author2=Thomas Jr, Landon |author3=Schwartz, Nelson D. |date=14 February 2010 |title=Wall St. Helped To Mask Debt Fueling Europe's Crisis |work=The New York Times |url=https://www.nytimes.com/2010/02/14/business/global/14debt.html |access-date=6 May 2010}}</ref> The Greek crisis was triggered by the [[Great Recession]], which caused Greece's [[Gross domestic product|GDP]] to contract 2.5% in 2009.<ref>{{Cite book |url=https://www.oecd.org/gov/budgeting/47840787.pdf |title=Restoring public finances |publisher=[[OECD]] |year=2011 |pages=119 |language=en |chapter=Country notes: Greece}}</ref> Simultaneously, deficits were revealed to have been allowed to reach 10% and 15% in 2008 and 2009. This caused Greece's debt-to-GDP ratio to spike to 127%.<ref name="Debt 2009 2017 Eurostat">{{cite news |url=https://ec.europa.eu/eurostat/tgm/refreshTableAction.do?tab=table&plugin=1&pcode=teina225&language=en|title= Eurostat (Government debt data)|work= Eurostat |access-date=5 September 2018}}</ref> As a eurozone member, Greece had no autonomous [[Economic and Monetary Union of the European Union#Monetary policy inflexibility|monetary policy flexibility]], it could not change interest rates or let its exchange rate absorb the shock. Consequently, Greece's borrowing rates increased, making it impossible for it to finance its debt from early 2010. In May 2010, the deficit was estimated to be 14%<ref>{{cite news|title=Papandreou Faces Bond Rout as Budget Worsens, Workers Strike |url=https://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUi3XLUwIIVA |publisher=Bloomberg L.P. |date=22 April 2010 |access-date=2 May 2010 |url-status=dead |archive-url=https://web.archive.org/web/20110623231800/http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUi3XLUwIIVA |archive-date=23 June 2011 }}</ref> the second highest in the world.<ref>{{cite news| author=Staff | title = Britain's Deficit Third Worst in the World, Table| url =https://www.telegraph.co.uk/finance/financialcrisis/7269629/Britains-deficit-third-worst-in-the-world-table.html| date = 19 February 2010 |access-date=5 August 2011 |work=The Daily Telegraph |location=London }}</ref> Public debt was forecast to reach up to 120% of GDP in 2010,<ref>{{cite news|author1=Melander, Ingrid |author2=Papchristou, Harry | title = Greek Debt To Reach 120.8 Pct of GDP in '10 β Draft| url =https://www.reuters.com/article/greece-budget-debt-idUSATH00496420091105 |work=Reuters | date = 5 November 2009 |access-date=5 August 2011}}</ref> causing a crisis of confidence in Greece's ability to pay back loans. To avert a [[sovereign default]], Greece, other eurozone members, and the [[International Monetary Fund]] agreed on a rescue package which gave Greece an immediate β¬{{Nowrap|45 billion}} in loans, with additional funds to follow, totaling β¬{{Nowrap|110 billion}}.<ref>{{cite news|author1=Thesing, Gabi |author2=Krause-Jackson, Flavia |title= Greece Faces 'Unprecedented' Cuts as $159B Rescue Nears |url=https://www.bloomberg.com/news/2010-05-02/greece-faces-unprecedented-cuts-as-159b-rescue-nears.html | publisher=Bloomberg |date=3 May 2010 |access-date=6 May 2010}}</ref><ref>{{cite news |author=Kerin Hope |title=EU Puts Positive Spin on Greek Rescue |url=http://www.ft.com/cms/s/0/08a87e4e-55c4-11df-b835-00144feab49a.html |archive-url=https://ghostarchive.org/archive/20221210201220/https://www.ft.com/content/08a87e4e-55c4-11df-b835-00144feab49a |archive-date=10 December 2022 |url-access=subscription |work=Financial Times |date=2 May 2010 |access-date=6 May 2010 |url-status=live }}</ref> Greece was required to adopt harsh [[Austerity|austerity measures]] to bring its deficit down.<ref>{{cite news|last=Newman |first=Rick |title=Lessons for Congress From the Chaos in Greece |url=https://www.usnews.com/news/blogs/rick-newman/2011/11/03/lessons-for-congress-from-the-chaos-in-greece |access-date=3 November 2011 |newspaper=US News |date=3 November 2011 |url-status=dead |archive-url=https://web.archive.org/web/20111104005053/http://www.usnews.com/news/blogs/rick-newman/2011/11/03/lessons-for-congress-from-the-chaos-in-greece |archive-date=4 November 2011 }}</ref> A second bail-out of β¬{{Nowrap|130 billion}} (${{Nowrap|173 billion}}) was agreed in 2012, subject to strict conditions, including financial reforms and further austerity.<ref name= BBCQ&A>{{cite news |url=https://www.bbc.co.uk/news/business-13798000 |title= Q&A: Greek debt |work=BBC News Online |access-date=14 May 2012}}</ref> A [[Debt relief|debt haircut]] was agreed.<ref name= BBCQ&A /> Greece achieved a [[balanced budget|budget surplus]] in 2013 and returned to growth in 2014 after years of decline,<ref name="Kathimerini growth">{{cite news|last1=Bensasson|first1=Marcus|title=Greece exited recession in second quarter, says EU Commission|url=http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_04/11/2014_544283|access-date=4 November 2014|work=[[Kathimerini]]|date=4 November 2014}}</ref><ref>{{cite news|title=Greek growth rates put Germany, eurozone to shame|url=http://www.marketwatch.com/story/greek-growth-rates-put-germany-eurozone-to-shame-2014-11-14|access-date=16 November 2014|work=[[MarketWatch]]|date=14 November 2014}}</ref> A third bailout was agreed in 2015, after a confrontation with the newly elected government of [[Alexis Tsipras]]. Partly due to the imposed austerity measures,<ref name=":3">{{Cite news |title=Is the Greek financial crisis over at last? |language=en |newspaper=The Economist |url=https://www.economist.com/the-economist-explains/2018/08/21/is-the-greek-financial-crisis-over-at-last |access-date=26 December 2022}}</ref> Greece experienced a 25% drop GDP between 2009-15.<ref>{{Cite news |date=10 July 2015 |title=The Greek debt crisis story in numbers |language=en-GB |work=BBC News |url=https://www.bbc.com/news/world-europe-33407742 |access-date=26 December 2022}}</ref> This had a critical effect: the debt-to-GDP ratio, jumped from its 2009 level of 127% to about 170%, due to the shrinking economy.<ref name="Debt 2017 Eurostat">{{cite news |url=https://ec.europa.eu/eurostat/documents/2995521/8824854/2-24042018-AP-EN.pdf/2e4cce59-7d36-4894-b21e-9f2c14b81630 |archive-url=https://web.archive.org/web/20180428162026/http://ec.europa.eu/eurostat/documents/2995521/8824854/2-24042018-AP-EN.pdf/2e4cce59-7d36-4894-b21e-9f2c14b81630 |archive-date=28 April 2018 |url-status=live|title= Eurostat (2017 Government debt data)|work= Eurostat |date=24 April 2018 |access-date=5 September 2018}}</ref> In 2013, the IMF admitted it had underestimated the effects of tax hikes and budget cuts and issued an informal apology.<ref name="IMF Guardian">{{cite news |url=https://www.theguardian.com/business/2013/jun/05/imf-admit-mistakes-greek-crisis-austerity |title= IMF 'to admit mistakes' in handling Greek debt crisis and bailout (The Guardian) |date=5 June 2013 |access-date=22 June 2018}}</ref><ref name="IMF Reuters">{{cite news | url=https://www.reuters.com/article/us-imf-greece/for-hard-hit-greeks-imf-mea-culpa-comes-too-late-idUSBRE9550M320130606 |title= For hard-hit Greeks, IMF mea culpa comes too late (Reuters) |date=6 June 2013 |access-date=22 June 2018}}</ref><ref name="IMF Telegraph">{{cite news |url=https://www.telegraph.co.uk/business/2016/07/28/imf-admits-disastrous-love-affair-with-euro-apologises-for-the-i/ |archive-url=https://ghostarchive.org/archive/20220110/https://www.telegraph.co.uk/business/2016/07/28/imf-admits-disastrous-love-affair-with-euro-apologises-for-the-i/ |archive-date=10 January 2022 |url-access=subscription |url-status=live |title= IMF admits disastrous love affair with the euro and apologises for the immolation of Greece (The Telegraph) |date=29 July 2016 |access-date=22 June 2018}}{{cbignore}}</ref><ref name="Fiscal adjustment">{{cite news |url=http://bruegel.org/2015/02/should-other-eurozone-programme-countries-worry-about-a-reduced-greek-primary-surplus-target/ |title=Should other Eurozone programme countries worry about a reduced Greek primary surplus target? |date=25 February 2015 |access-date=28 May 2017}}</ref> The policies have been blamed for worsening the crisis,<ref name="IMF Bloomberg">{{cite news |url=https://www.bloomberg.com/news/articles/2018-06-18/why-three-rescues-didn-t-solve-greece-s-debt-problem-quicktake |title= Why Three Rescues Didn't Solve Greece's Debt Problem (Bloomberg) |date=18 June 2018 |access-date=22 June 2018}}</ref><ref name="IMF WSJ">{{cite news |url=https://www.wsj.com/articles/will-the-imf-apologize-to-greece-1402863715 |title= Will the IMF Apologize to Greece ? (WSJ) |date=15 June 2014 |access-date=22 June 2018}}</ref> while Greece's president, [[Prokopis Pavlopoulos]], stressed the creditors' share in responsibility.<ref name="Pavlopoulos Statement">{{cite news |url=http://www.ekathimerini.com/229962/article/ekathimerini/news/debt-deal-exceeded-market-expectations-tsipras-says |title= Debt deal exceeded market expectations, Tsipras says (Kathimerini) |date=22 June 2018 |access-date=22 June 2018}}</ref><ref name="Pavlopoulos Moscovici">{{cite news |url= http://www.kathimerini.gr/972843/gallery/epikairothta/politikh/paylopoylos-se-moskovisi-na-mhn-epanalhf8oyn-la8h-poy-odhghsan-se-odynhres-8ysies-ton-lao |title= Pavlopoulos to Moscovici: the mistakes that led to painful sacrifices for the Greek people should not be repeated (Kathimerini, in Greek)) |date=3 July 2018 |access-date=30 July 2018}}</ref> Tsipras asserted that errors in the design of the programmes led to a loss in the economy.<ref name="Tsipras Bloomberg">{{cite news |date=27 June 2018 |title=Tsipras says Greece won't go back to old spending ways |url=https://www.bloomberg.com/news/videos/2018-06-27/tsipras-says-greece-won-t-go-back-to-old-spending-ways-video |access-date=30 July 2018}}</ref><ref name="Debt 2017 Eurostat"/> Greece's bailouts ended in August 2018.<ref name="Bailout exit Reuters">{{cite news |url= https://www.reuters.com/article/us-eurozone-greece-bailout/greece-exits-final-bailout-successfully-esm-idUSKCN1L40OG |title= Greece exits final bailout successfully: ESM |work= Reuters |date=20 August 2018 |access-date=31 August 2018}}</ref> Summary: Please note that all contributions to Christianpedia may be edited, altered, or removed by other contributors. 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