The Greek Government Debt Crisis

Decent Essays

The Greek government-debt crisis has seldom seen a break from the public eye since its first bailout loan in 2010. With a sweeping change in political standing, the question now looms as to whether the newly elected Prime Minister, Alexis Tsipras should pull the plug on Greece’s membership in the Eurozone. In the most part, International financial and political institutions such as the International Monetary Fund (IMF) and the European Union (EU) are helping economic recovery in Greece. Through a variety of implemented fiscal and social measures, Greece will ultimately be spared from a detrimental Grexit, seeing a sound economic outcome through means of democratic legitimacy.

The IMF and EU have loaned vast sums to the Greek government, aiding in an economic recovery for the nation. These institutions, along with the European Central Bank (ECB) and many other creditors within the EU have set out fiscal and monetary guidelines that will see the loans be of most use to the economy. Through poorly regulated finances, Greece was facing government bankruptcy prior to the 2010 bailout. These funds have not only saved the government, but an entire nation. As of the 27th of April 2015, Greek public debt stood at 320.4 billion euros (€), with a debt-to-GDP ratio of 180.2 percent. Although this figure is astoundingly large, the policies put in place by creditor institutions mean the debt is manageable, and will be reduced significantly over a period of years. Austerity measures

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