Four years of memorandums and austerity

April 23, 2014
Written by E.Tsiliopoulos

It was a sunny spring day exactly four years ago, when then prime minister George Papandreou stood in front of the camera with the beautiful island picture of the Kastelorizo port in the background and announced to the Greek people that state borrowing had become unattainable.

That was the beginning of a financial, social and political adventure, which is still in full swing. Two memorandums, three PMs and about a 30% loss of the GDP later, the country is still suffering from a devastating recession. It all started four years ago, when Papandreou announced the country was welcoming the Troika (IMF, European Commission, ECB) for a lending program.

The country's debt was at 120% of the country's GDP in the spring of 2009. Today, after four years of the most strict fiscal adjustment western Europe has ever seen, the debt is at 175% of GDP. If ever there was an indication that the debt is totally unmanageable, this is it.

Wages took a dive, unemployment reached record numbers (27%), homelessness, desperation, suicides went up, unions were disregarded, employees rights diminished, businesses went belly up and the national mood turned almost suicidal.

On the upside, the country achieved its first primary surplus and it successfully came out to the capital markets.

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