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  • Greece is currently about 400 billion dollars in debt. That’s about 170% of their annual

  • Gross Domestic Product. Over the next 50 years they are scheduled to repay that debt. But

  • with the economy in shambles, many experts wonder if that goal is really attainable.

  • But how did Greece end up with so much debt in the first place? And to whom, specifically,

  • does Greece owe money?

  • Greece became somewhat politically and economically unstable back in the 1970s after an attempted

  • government coup. Nevertheless, after a profit spike in the 1990s, they met the fiscal requirements

  • to join the Eurozone, in the year 2000. This event inextricably tied Greece to stronger

  • economies like Germany and France, and allowed Grecians more access to low-interest loans.

  • So, public spending and government borrowing soared, even as Greece’s debt remained higher

  • than the Eurozone average in the 2000s.  When the international Recession of 2008 hit, Greece

  • spiraled into a debt crisis. To make matters worse, in 2009, it was revealed that Greece

  • had been falsifying reports on their debt for years. When the real statistics were exposed,

  • their national credit rating took a plunge, which in turn, caused investors to jack up

  • interest rates. Greece has been on the brink of bankruptcy ever since. German Chancellor

  • Angela Merkel later said that “[Europe] should not have accepted Greece into the eurozone”.

  • Out of the roughly 320 Billion Dollars in bailout money that Greece must eventually

  • pay back,  most of it, or about 47%, is due to the European Financial Stability Facility.

  • This is a temporary organization created by Eurozone members to pool money tog ether and

  • help stabilize member countries in crisis. Greece, Portugal and Ireland are the primary

  • recipients of the EFSF.

  • 19% of Greece’s debt is held by other Eurozone Governments. Another 12% is held by private

  • investors. And the rest - about 22% - is held by the European Central Bank, the International

  • Monetary Fund andtreasury bill holders”, who are primarily Greek banks., .

  • Yet, after all the financial help, Greece remains in trouble. The unemployment rate

  • for those aged 15 to 24 is at 55%. Further, budget cuts are so unpopular that they have

  • led to riots and protests. Meanwhile Greece and other European Governments are locked

  • in heated dispute as to whether Greece should or even COULD make more financial reforms.

  • Germany, and France, who have invested nearly 115 Billion Dollars in the country, don’t

  • want to see Greece default on its debt, but they are also refusing to give Greece another

  • bailout.

  • During the next half century, Greece needs to stimulate its economy while decreasing

  • government spending. In the end, most experts agree that Greece will not be allowed to go

  • bankrupt. The financial loss for other Western countries, including the United States, would

  • be too great, and could potentially create another international recession.

  • Although it’s uncommon, and definitely not the same as with people, countries can end

  • up bankrupt. To learn more, make sure you check out this full video now. Thanks for

  • watching guys! See you all tomorrow!

Greece is currently about 400 billion dollars in debt. That’s about 170% of their annual

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Why Does Greece Have So Much Debt?

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    James posted on 2015/06/15
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