Greece
The Greek Economic Crisis: 5 Charts That tell The Story
 |
| The “spread” over 10-year German bunds is the standard measure of perceived risk. It is the premium, or additional interest, that markets demand for holding the debt of a euro-zone country compared with the bonds isued by Germany, deemed the safest. |
- November 2009 – The new government pledges in its 2010 draft budget on Nov. 5 to save Greece from bankruptcy by cutting the budget deficit of 12.7 percent of GDP
- Nov. 20 Greece aims to cut the deficit to 8.7 percent of GDP in 2010
- Dec 4: public debt rising to 121 percent of GDP in 2010 from 113.4 percent in 2009.
- EU 2010 forecasts on Greece are worse, with the deficit seen at 12.2 percent of GDP and national debt rising to 124.9 percent, the highest ratio in the EU.
- December 2009 — S&P on Dec. 7 puts the country’s A- sovereign rating on negative watch.
- Fitch Ratings, which had cut Greece to A- when the government revealed the higher deficit, cuts Greek debt to BBB+ with a negative outlook, the first time in 10 years a ratings agency has put Greece below the A investment grade.
- On Dec. 14, Greece pledges 10 percent cut in social security spending in 2010.
- Announces overhaul of pension system in six months and new tax system that will make wealthy carry bigger burden.
- Dec. 16 S&P cuts Greece’s rating to BBB+ from A
- Dec. 19 The German 10-year Bunds widen to an average 272 basis points, the widest in more than eight months
- Dec. 22 – Moody’s cuts Greek debt to A2 from A1, the third agency to downgrade Greece, but still two notches above that of Fitch and S&P.
- January 2010 – Greece unveils a stability programme on Jan. 14 saying it will aim to cut its budget gap to 2.8 percent of GDP in 2012 from 12.7 percent in 2009.
- February 2010 – Government extends a public sector wage freeze to those making below 2,000 euros a month for 2010, excluding seniority pay hikes.
- On Feb. 3 the EU Commission says it backs Greece’s plan to reduce its budget deficit below 3 percent of GDP by 2012 and urges Greece to cut its overall wage bill.
- A one-day general strike on Feb. 24 against the austerity measures cripples Greece’s transport and public services.
- Finance Ministry official anticipate Greece can cut the deficit by about 2 percentage points, short of a 4 percentage point target for 2010. This will mean additional economy measures worth 4.8 billion euros.
- New package of public sector pay cuts and tax increases passed by the government on March 5 to save an extra 4.8 billion euros ($6.5 billion).
- The measures include raising VAT by 2 percentage points to 21 percent, cutting public sector salary bonuses by 30 percent, increases in tax on fuel, tobacco and alcohol, as well as freezing state-funded pensions in 2010.
- On March 15, euro zone finance ministers meeting in Brussels agree on a mechanism that will allow them to help Greece financially if needed, but they reveal no details except that it would be without loan guarantees.
source : Reuters
Charts Source : Economist
The Making of Greece Economic Tragedy:
Created by OANDA
The economy of Greece is the 32nd largest in the world by nominal gross domestic product (GDP) and the 37th largest at purchasing power parity (PPP), according to data by the World Bank for the year 2010. Per capita, it is ranked 24th by nominal GDP and 23rd at PPP according to the 2009 data.
A developed country, Greece is a member of the European Union, the eurozone, the OECD, the World Trade Organization and the Black Sea Economic Cooperation Organization.
The service sector contributes 78.8% of GDP, industry 17.9%, and agriculture 3.3%. The public sector accounts for about 40% of total economic output. Greece is the 31st most globalized country in the world and is classified as a high-income economy.
Will Greek islands soon be on sale? It may sound far-fetched, but it’s one of the proposed solutions to save the country, which is drowning in debt and on the brink of default. The €110 billion bailout granted by the EU and IMF in May 2010 may not be enough, and Socialist Prime Minister George Papandreou is pushing through tough new austerity measures – much to the displeasure of millions of Greek citizens who have taken to the streets over the past months.
COMPARISON CHARTS 