Greece. The strict supervision of European Union creditors over public finances has ended

12 years later, strict supervision of creditors from the European Union over Greece’s public finances officially ended on Saturday, the Associated Press agency reported. The country will no longer have to undergo quarterly checks to receive payments from the bailout package.

– This is a historic day for Greece – Prime Minister Kyriakos Micotakis said during his speech on state television.

As the Associated Press points out, the end of tight financial supervision gives the center-right Micotakis government greater budgetary freedom at a time when Greece, like all of Europe, faces rising costs of living from the effects of the pandemic COVID-19as well as the energy crisis triggered by the Russian invasion of Ukraine.

However, this does not mean the complete end of financial supervision over Greece. Like other EU countries such as Spain, Portugal, Cyprus and Ireland, it will continue to be supervised by creditors while it is being paid. The last loans are to be repaid in 2070.

Quoted by AP Wolfango Piccoli, vice president and research director at Teneo, a consulting firm that has dealt with the financial crisis in Greece for years, said the end of enhanced oversight was “largely a technical matter.” The Micotakis government could use this to break up the country’s political capital, but “the vast majority of the population is focused on the rising cost of living,” he said.

Greece. Illustrative photoPAP / EPA / ACHILLEAS CHIRAS

The crisis in Greece shook the world market

The debt crisis in Greece has shaken world markets and “strained EU unity to the limit,” recalls the Associated Press.

Investors stopped lending Greece money in 2010 after Athens pleaded guilty to misrepresented budget figures. To prevent the country’s insolvency, EU partners and the International Monetary Fund approved three rescue package programs for the period 2010-2018 with a total value of EUR 290 billion.

In return, creditors demanded from Greece deep cuts in government spending and wage cuts, tax increases, privatization and other wide-ranging reforms to restore public finances. The Greek economy has contracted by more than a quarter and unemployment has risen to almost 28%.

The economic downturn and government relief efforts to combat the effects of the coronavirus pandemic meant that the public debt Greece has reached the level of 206 percent. GDP in 2020, but declined in 2021 and is expected to reach 185% this year.

Main photo source: PAP / EPA / ACHILLEAS CHIRAS

Leave a Comment

Your email address will not be published. Required fields are marked *