Greece Financial Crisis
Katherine Domingo Chavarria
In the textbook it states “the legitimacy claims of the globalization project for universal prosperity are contradicted by the universal reach of austerity politics” (242). This is true because it can be seen through the way Greece is being taken care of more so than countries that are considered a part of the third world.
As most people know, Greece has been experiencing near bankruptcy since 2010. It all started in 2009 when the country of Greece’s credit rating was downgraded by one of the world’s three leading rating agencies.
In 2010, the downgrading of Greece led to many strikes and protests by the people and trade unions toward the government. With the Eurozone fearful of default, they approved 145 bn euros to bail out Greece. This agreement wasn’t working well because many protest were directed at parliament for the disapproval of the new austerity laws.
In 2011, all three major credit rating agencies cut Greece’s ratings; the cut led to 109 bn euros to be given to Greece by the European Financial Stability Facility.
In 2012, Greece had to have a second bailout of 130 bn euros from the EU as a debt swap, a cut of half the debt load, which caused another trade union strike. With half the debt cut, Greece was given an austerity plan of 13.5 bn euros by the EU and IMF in bailout loans.
In 2013, Greece suffered from high unemployment rates, as high as 28% with the total population and 60% with youth unemployment.
In 2014, Greece was released of over 8 bn euros in bailout funds, financed by the Eurozone. During this year Greece was able to raise $4 billion dollars; it seemed that Greece was heading for recovery. Recovery was diverted with a new crisis, the election of a new president.
In 2015, the European Central Bank ends Greece emergency fundings. This led to the closing of banks and the imposing of capital control. After receiving a new bailout proposal from the EU, Greece voters decide to reject the terms. In the end Greece avoids bankruptcy by agreeing to a third bailout and exit from the Eurozone.
Greece has suffered many financial crises and has received help through the EU and IMF. Why can’t other countries receive help, too? They are just as helpless as Greece was.