Greek economy default

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Unit 4 - Greek Economy Default

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Greek economy default

  1. 1. On the Brink of Default – The Greek Economy Tutor2u September 2011
  2. 2. Beware Greeks bearing debts• A founder member of the Euro in 2001• After years of strong growth - went into recession in 2009• Budget deficit was fraudulently under-reported• Fiscal deficit surged to 15.4% of GDP in 2010• Sharp loss of investor confidence• Caused large rise in borrowing costs (bond yields)• May 2010 Greece became the first euro zone member to receive a Euro 110bn rescue package from the EU and IMF• Recession has continued• Greeces govt debt is now 150% of GDP and rising• Fiscal austerity has met with fierce political unrest• Recognition that default is inevitable• But with what consequences for Greece and the rest of Europe?
  3. 3. A Crisis of Confidence – Bond Yields
  4. 4. Real GDP Growth
  5. 5. Recession and Unemployment
  6. 6. Soaring unemployment
  7. 7. Decade of improved relative living standards is lost
  8. 8. An unsustainable level of debt
  9. 9. Fiscal Crisis Prompts Default
  10. 10. Fewer people in work and a weaker trend growth rate
  11. 11. Manufacturing and Property in a Slump

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