Greece bailout ends but with no substantial effect on citizens’ life

Informal working meeting on migration and asylum issues
Date: 24/06/2018 . Location: Belgium,Brussels – EC/Berlaymont. © European Union , 2018 Photo: Etienne Ansotte

It was yesterday when the Prime Minister Alexis Tsipras stated from the Greek island of Ithaca that the austerity measures are over cheering for the Greek bailout programme exit.

Mario Centeno, the chairman of the ESM’s board of governors, had said last Monday that Greece is once more a nation which doesn’t need any additional rescue programme thanks to the effort carried out by the Greek government and people.  Sharing the same views, Pierre Moscovici mentioned that the Greek economy has recovered concluding a three year European Stability Mechanism (ESM) stability support programme.

However, the International Monetary Fund (IMF) reports that Greece still faces many challenges which include its economic growth and staggering debt.

Background

The Greek government has been under surveillance and financial assistance since 2010. In the last 8 years, Greece is provided with 288,7 billion euros in loans from its EU partners and IMF. The last financial aid was requested by the ESM in July 2015. After three long years, the Eurogroup confirmed that all perquisites of the fourth and final review of the programme have concluded giving the green light for Greece’s exit from the financial aid package.

End of third bailout programme

During ESM’s support, Greece received 61,9 billion euros in loans on the basis of implementation of a comprehensive and unprecedented reform package. The aim of this programme was to implement structural reforms to aid Greece recover from the economic crisis. According to the European Commission, the end of the bailout programme is accomplished due to the EU solidarity and Greece’s decisiveness. More particularly, Jean-Claude Juncker, European Commission President, mentioned last Monday: “The conclusion of the stability support programme marks an important moment for Greece and Europe. While their European partners have demonstrated their solidarity, the Greek people have responded to every challenge with a characteristic courage and determination. I have always fought for Greece to remain at the heart of Europe. As the Greek people begin a new chapter in their storied history, they will always find in me an ally, a partner and a friend.”

The Chairperson of the ESM Board of Governors announced on August 20 the conclusion of ESM programme as Greece is now a self-sustaibable country with no further follow-up financial packages due to its economic growth prospects. Particularly, Mario Centeno stated: “The ultimate goal of the financial assistance plan and reforms in Greece over the past eight years has been to create a new basis for healthy and sustainable growth. It took much longer than expected but I believe we are there: Greece’s economy is growing again, there is a budget and trade surplus, and unemployment is falling steadily.” What is more, ESM Managing Director Klaus Regling outlined that Greece is the fifth country to exit such a programme but has to further invest on implementing the necessary reforms in order to continue its prosperous economic path.

A new Greek era?

The Greek Prime Minister was very optimistic in his televised speech yesterday. Mr Tsipras said that “today is a day of redemption, but it is also the start of a new era”, clearly referring to the exit of Greece from the bailout programmes which was accomplished by his government. It is quite certain that Alexis Tsipras will use it to gain back momentum after the catastrophic wildfires which have costed many lives and shown the inadequacy of the Greek government.

Furthermore, Mr Tsipras stated that “we must remember that the return to Ithaca is not the end of the adventure” showing that this bailout exit does not mean that everything is over but Greece should proceed to more reforms. Besides, the EU and EC will always be there to ensure that Greece will repay its loans to its full.

Too difficult to maintain economic growth and surpluses

This should not be a cheering moment for Greece as many challenges remain to be dealt in the decades to come. Constantine Fraser, European analyst at research firm TS Lombard, told CNBC via email that “both the EU and the Greeks will try to put a positive spin on the end of the bailout, but there is little to celebrate”. Furthermore, Ricardo Garcia, chief euro zone economist at UBS, told CNBC that there is much more to be done and structural reforms together with fiscal discipline need to stay in place.

The fact that the Greek government has to focus on a very strict programme and ensure budget surplus of at least 2,2% of GDP till 2060 the moment that its accumulated debt stands at around 180% of GDP makes things look ominous.

All in all, it is very promising that Greece managed to get out of the bailout programmes after all these years of financial support but the Greek government should not only not stay assured but also understand that there is still a long and hard way to go.

Thus, it is not time to cheer up but make sure that this will have a positive effect on Greek citizens’ everyday life.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Migration has set EU’s political clock ticking; the stagnating economy cannot help it and Turkey doesn’t cooperate

Facility for Refugees in Turkey: €127 million to boost EU’s largest ever humanitarian programme

Ground-breaking clean air protocol to guard human health and the planet, enters into force

How a possible EU budget deficit affects the migration crisis

MEPs approve boost to workers’ rights in the gig economy

The G7 adopted dangerous views about Ukraine and Greece

One more country to test the EU project: Kaczynski’s Poland

The UK to split if May’s hard or no-deal Brexit is pursued

The world to teach Germans to…un-German

Innovative urban financing can make our cities stronger

Sweden must urgently implement reforms to boost fight against foreign bribery

Guterres: Security Council’s African alliances ‘needed and appreciated more than ever’

EU-US relations on the dawn of the Trump era

Youth Internationalization: part of everyday life in JADE

‘Revved up climate action’ needed to counter ‘prolonged’ and deadly storms like Cyclone Idai: Guterres

The importance of exchanges for the medical students of the world

European Commissioner for Youth wants young people to be at heart of policy making

No improvement in respect for EU values: MEPs cut support for Turkey by €70m

The EU bows to Turkey in view of the talks for a political settlement in Syria

Gaza investigators call on Israel to review ‘rules of engagement’ as Gaza protest anniversary looms

Countries should focus on labour market policies to help refugees and improve coordinated actions to tackle illegal immigration

A Sting Exclusive: “Stronger Cybersecurity for a safer EU against cybercrime and cyber threats”, by MEP Dalli

Greece and Ukraine main items on EU28 menu; the course is set

Lagarde’s metamorphoses, not a laughing matter

Israel is joining forces with Arab states to save coral from climate change destruction

The challenges of mental health among the Syrian medical students

Work and reforms of the UN ‘at risk’, Guterres warns Member States, amidst ‘record-level’ cash crisis

Want a Sustainable Earth? Bring on the Fourth Industrial Revolution

Greater transparency, fairer prices for medicines ‘a global human rights issue’, says UN health agency

A brief history of cryptography and why it matters

United States: UN chief ‘deeply saddened’ by deadly California wildfires

More than half a million Rohingya in Bangladesh get ID cards for first time: UN refugee agency

China dazzles the world with her Silk Road plan to connect, Asia, Europe and Africa

UN health agency highlights lifestyle choices that can prevent onset of dementia, as millions more succumb each year

France breaks budget promises once again and the EU’s finance offices are shaking

Can Greece’s democratic institutions keep it in Eurozone?

Businesses, governments and consumers to implement a more climate-friendly approach to #BeatPlasticPollution on World Environment Day 2018

UN investigates systematic sexual violence across South Sudan

Britain’s May won the first round on the Brexit agreement with the EU

Time to be welcome: Youth work and integration of young refugees

The European Sting @ European Business Summit 2014 – the preview

We could be sleepwalking into a new crisis. How should the business world prepare?

What UK and EU risk if Brexit “wins” these elections

Chinese economy to raise speed and help the world grow

Nordic companies prove doing good is good for the bottom line

Africa-Europe Alliance: European Commission committed to a sustainable African agri-food sector

Brexit: Is there anybody supporting a non-violent separation?

How to promote Primary Healthcare to the Young Healthcare Workforce?

The EU Commission vies to screen Chinese investment in Europe

UN chief condemns explosion at election rally in Zimbabwe that injured dozens, including senior politicians

“Financial crisis will not happen in China!”, the Chinese Premier underlines from Switzerland; the Sting reports live from World Economic Forum 2015 in Davos

Europe must regain its place as world leader in digital technology

Gender Equality as a platform to improve Medicine

3 ways blockchain can revolutionize global supply chains

Eurozone: Uncertain future with unemployment ravaging the South

EU-Turkey relations: Will Turkey manage to revive the EU accession process talks?

1 million citizens try to create a new EU institution

Can China deal with climate change without the U.S.?

Economic uncertainty, geopolitical tensions stall growth in Latin America and Caribbean region, UN says

Amid ‘volatile’ environment, UN mission chief urges Iraqi leaders to ‘listen to the voice of the people’

More Stings?

Trackbacks

  1. […] European Stability Mechanism (ESM) provided the bailout worth  €61.9 billion for three years as an effort to help the Athens administration reform the economy and recapitalize […]

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s