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How The Greek Economic Crisis Will Affect Other European Countries

By Jack Wogan

An unforgettable vacation on the land of the ancient Olympian Gods, delicious dishes, great traditional music and sunny beaches – this is what used to come to mind when thinking about Greece. For years, this country was the favorite holiday destination for more that 15 million tourists. Mykonos, Santorini, Rhodes, Crete, Corfu or Samos – these are only a few of the paradisaical islands that people chose in order to relax and forget about daily problems.

Why is that? How is it possible for a prosperous country, with 15 million tourists every year to make the international headlines not because of its flourishing economy but because of the numerous strikes and overwhelming external debt? Because, at this moment, Greece’s national debt exceeds 400 billion euro and it is bigger than the country’s economy. And there a voices saying that by this time next year it will reach 120% of gross domestic product.

The truth is that Greece’s economic situation is so bad that it seems unlikely for the Olympian Gods to enjoy a lot of company from foreigners in the immediate future. But how did this happen? How was it possible for a country that used to accommodate over 15 million tourists every year to make the international headlines not because of its flourishing economy but because of its overwhelming external debt? Greece’s national debt exceeds 400 billion euro at the moment and it is bigger than the country’s entire economy, experts say. Some even predict that it will reach 120% of gross domestic product by this time next year.

One thing is for sure: the current situation, with the numerous strikes and terrible instability, Greece is no longer appealing to foreigners. Losing the income that tourists brought only worsened an already difficult situation. Greece’s economy has collapsed and the country is undergoing social and financial turmoil. And the worst part is that its financial situation has pushed down the value of the euro against the dollar and it now threatens to affect the euro zone. One of the first and most obvious consequences is that investors planning to invest in euro zone countries such as Italy, Portugal or Spain will be scared off.

Obviously, The Greek Government tried to solve the problem by applying a set of austerity measures such as raising the retirement age, cutting public sector pay, freezing the state pension and tough tax evasion regulations. In order to help resuscitate its economy, the other 16 countries that form the euro zone have put together a rescue plan for Greece. However, it will be applied only as a last resort and it will involve a series of bilateral loans from countries inside the common currency area as well as some support from the International Monetary Fund.

In times of economic instability, Gold Sovereigns coins made of 22 carat precious metal are an excellent opportunity for both coin collectors and investors.

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Article Citation
MLA Style Citation:
Wogan, Jack "How The Greek Economic Crisis Will Affect Other European Countries." How The Greek Economic Crisis Will Affect Other European Countries. 17 Aug. 2010. uberarticles.com. 31 Oct 2014 <http://uberarticles.com/finance/investments/how-the-greek-economic-crisis-will-affect-other-european-countries/>.

APA Style Citation:
Wogan, J (2010, August 17). How The Greek Economic Crisis Will Affect Other European Countries. Retrieved October 31, 2014, from http://uberarticles.com/finance/investments/how-the-greek-economic-crisis-will-affect-other-european-countries/

Chicago Style Citation:
Wogan, Jack "How The Greek Economic Crisis Will Affect Other European Countries" uberarticles.com. http://uberarticles.com/finance/investments/how-the-greek-economic-crisis-will-affect-other-european-countries/


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