Greece. Heavily pushed by the EU and, above all, by the
euro area countries, the Greek government struggled to
tackle its debt crisis and prevent the economy from falling
freely. An urgent EU survey showed that the 2009 budget
deficit had been underestimated and was about 15.4 per cent
of GDP instead of 12.7 per cent as the country's official
statistics had shown. The country's credit rating was
lowered and speculators raised interest rates on loans that
the state wanted to take to pay interest on government debt.
The situation became unsustainable in the spring and the
euro countries, with Germany at the forefront, decided in
great anguish in May, together with the International
Monetary Fund IMF, to distribute a total loan of EUR 110
billion over three years.
has a population of 10.72 million (2019). The loan was linked to severe austerity. For public
employees, a freeze on salaries until 2014, a reduction in
bonuses and a salary cap for CEOs were noted. The retirement
age in all sectors was gradually increased, the possibility
of retiring prematurely was halted, as were the increases in
the state-financed pensions. Cuts were made in the health
care sector. Taxes were increased on fuel, tobacco, alcohol
and luxury products. VAT was increased several times during
the year. In addition, the state sold 49 percent of the
railroad, parts of some companies, some ports and airports
and all state casinos. The country, which had Europe's
highest military spending per inhabitant, also began to cut
down on some purchases of military equipment. The 2011
budget included, among other things, increased taxes on
property and gambling.
The reforms provoked protests and in many cases the
police used tear gas to keep protesters in check. Distrust
among Greeks in general was great; During the first two
months of the year, savings worth EUR 10 billion were moved
from Greek banks to foreign banks. Several economists were
also critical, noting that the reduction in public spending
helped to curb growth and consumption. The local elections
held across the country for two rounds in November were
considered a referendum on the government's handling of the
debt crisis and gave Prime Minister Giorgos Papandreou an
unexpectedly strong mandate. His social democratic party
PASOK won in Athens and Thessaloniki as well as in many
The economic crisis contributed to a further
deterioration of the refugee reception and the UN special
envoy on the issue Manfred Nowak reported that it was
"inhumane and degrading". The UN urged EU countries not to
send refugees back to Greece. Sweden stopped the expulsions
in early November; previously Norway, Finland and Austria
had done so. After an increasing number of Afghans had begun
to try to enter Greece via Turkey, the EU deployed its
special border security force, Rapid Border Intervention
Teams, in November, which had been set up in 2007 but had
not been used to assist the Greek border guards.
At least 14 packages packed with explosive charges were
sent from Greece to European governments, European embassies
in Athens and international agencies in Europe at the end of
October-November. Several of the explosive charges exploded
but no human was seriously injured. Two young left-wing
extremists were arrested on suspicion of involvement.
A policeman was sentenced in October to life imprisonment
for the shooting death of a 15-year-old boy in Athens in
2008. The policeman was sentenced to murder while his
colleague was given a 10-year prison sentence for assisting
in murder. The verdict poured oil on the waves in the
neighborhood where the incident occurred.
Failed presidential election and new parliamentary
Towards the end of 2014, Greece experienced the largest
youth uprising since the police killing of 15-year-old
Alexandros Grigoropoulos in 2008, when Nikos Romanos went on
hunger strike for the right to education from prison.
Romanos was a close friend of Grigoropoulos and was present
when the latter was shot. Romanos 'hunger strike
corresponded to the annual student rebel flag at Athens
Polytechnic University on November 17, 1973 and the
anniversary of Grigoropoulos' death on December 6.
Prime Minister Samaras announced early presidential
elections in December, but after three rounds in parliament,
the election ended without an agreement on a candidate. The
Samaras government was therefore forced to step down and a
new parliamentary election was announced on 25 January 2015.
The 2015 parliamentary elections ended with defeat for
Samaras and his party New Democracy. The left-wing party
SYRIZA, on the other hand, made an impasse and ended with
just over 36 percent and 149 out of 300 seats in parliament.
Party leader Alexis Tsipras was sworn in on January 26 as
Greece's youngest prime minister in 150 years.
Further negotiation with the Troika
Tsipras's first half as prime minister was marked by
renegotiation of the terms of agreement for repayment of the
crisis packages the country had received from the Troika
(EU, IMF and ESB). In February 2015, the parties agreed to
extend the loan agreement by four months. However, at the
expiry of this agreement in June, the parties did not agree
to an extension.
Greece has received a total loan amount from the Troika
of 240 billion euros, against promises of concrete savings
measures and reforms that, among other things, entailed
demands for privatization. The majority of the loan has gone
to pay off (bailout) crisis-hit national and international
banks in Greece. A plan for implementing austerity measures
and reforms must be approved by the Troika before Greece can
receive more crisis packages.
Without reaching an agreement, on June 27, Tsipras called
for a referendum to decide whether Greece should accept the
terms of the creditors. The referendum took place on July 5,
2015 and the Greeks were given the choice between voting
"yes" or "no" for the new proposals from the Troika on the
terms for further loans. The no-side won a solid majority
with 61.31 percent, while the yes-side gained 38.69 percent.
The turnout was 62.5 per cent.
The referendum was a big victory for the SYRIZA
government and Prime Minister Alexis Tsipras who had said he
would step down if the yes side won. The Greek government
interpreted the result as a declaration of support for
further opposition to the terms set by the Troika, which for
many has seemed harsh. Following the referendum, the
government announced that it would resume negotiations with
the three lenders, the European Union, the International
Monetary Fund and the European Central Bank.