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

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

UN chief calls for ‘enlightened self-interest’ from world leaders to save ‘the whole planet’ from climate change

What is digital equality? An interview with Nanjira Sambuli

Trump’s Russophiles under investigation, Europe remains ‘en garde’

Why the Greeks forgave Tsipras’ pirouettes around austerity and voted again for SYRIZA

What is ‘South-South cooperation’ and why does it matter?

Preparing for developing countries the ‘Greek cure’

More women and girls needed in the sciences to solve world’s biggest challenges

What has changed in the French politico-economic horizon

70 years after the Universal Declaration of Human Rights, this is why we need dignity more than ever

“China will strive to enhance the performance of economic growth”, President Xi highlights from the World Economic Forum 2017 in Davos

FROM THE FIELD: Rohingya babies conceived out of ‘incomprehensible brutality’

Will France vote for more or less Europe in the next presidential elections?

Commission threatens Chinese firms with trade penalties

A new Europe for people, planet and prosperity for all

ITU Telecom World Awards launches 2018 edition

Joint UN, OSCE engagement can address crisis in Ukraine, other ‘dark spots of conflict’ in Europe

New report says better metrics could have prompted stronger response to the crisis

A new bioeconomy strategy for a sustainable Europe

Ambassador Zhang Ming: “Work Together for a Better Globalization”

For how long will terror and economic stagnation be clouding the European skies?

These coastal countries are sinking the fastest

European Youth cries out: Sustainable Development Goals ambitious, but lack focus on youth

Backed by UN agency, countries set to take on deadly livestock-killing disease

Mobile 360 Series – Russia & CIS: Empowering the Digital Economy

London, Berlin, Paris to fight over EU budget

‘Let the children live’: UN prepares to ramp up food aid to Yemen as famine risk grows

UN-based World Summit Award (WSA) presents its master list on digital innovation with impact on society from 24 countries

Fighting cybercrime – what happens to the law when the law cannot be enforced?

Can a Bavarian Oktoberfest beer indulger bring down the Berlin government?

Security Council urged to act with ‘one strong voice’ on raft of ills plaguing Middle East and North Africa

3 lessons from India in creating equal access to vaccines

Superbugs: MEPs advocate further measures to curb use of antibiotics

Victims of terrorism remembered

EU to scrutinise foreign direct investment more closely

UN chief condemns air strike that hit school bus in northern Yemen, killing scores of children

Microplastics have spread right to the sea bed, study finds

European Youth Vlog

EU and China seize momentum to enhance trade agreements in response to Trump’s administration

How wealthy people transmit this advantage to their children and grand children

World Migratory Bird Day highlights deadly risks of plastic pollution

An all-out fight for the EU budget

Brussels Vs. Google: The €1 bn EU fine and the US response

Does the sharing economy truly know how to share?

ECB: The bastion of effective and equitable Europeanism keeps up quantitative easing

MEPs urge the EU to lead the way to net-zero emissions by 2050

Technology can help us end the scourge of modern slavery. Here’s how

FROM THE FIELD: Persons with disabilities bike towards sustainability

Here are three technology trends changing the way you travel

Are e-cigarettes as safe as they claim to be?

Here are six bold ideas to accelerate sustainable energy innovation

The clothes of the future could be made from pineapples and bananas

Eurozone’s central bank leadership prepares for shoddier prospects

Mine action is at ‘the nexus’ of peace, security and development: UN official

Job vacancy data reveal better prospects for Britain, stagnation in Eurozone

GSMA Announces Speakers for Mobile 360 – Russia & CIS 2018

Does Indonesia have the world’s most complicated elections?

European creativity and digital economy are drowning in a copyright swamp

This Japanese town has banned urban sprawl

These countries have some of the highest voter turnout in the world

EU leaders agree to delay Brexit until 31 October

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