Greece, a country in Europe which is considered as birthplace of Western Civilization. There is no doubt Greece has produced most number of philosophers, scientists, and many great minds. Today's modern Mathematics is the result of great Greek minds like Euclid, Pythagoras, Archimedes and many more.
But today, this great country is being eaten by one of the biggest crisis ever. What is the reason behind fall of this country? Here's a list of things which caused Greece this huge trouble.
1. 1999 Earthquake
It all started with 1999 Earthquake. This Earthquake had a magnitude of 6.0 on September 7 which lasted approximately 15 seconds. More than 100 buildings were collapsed including major companies and factories. This was one of the most devastating and costly disaster Greece had ever experienced. The loss was estimated about 3 Billion US Dollars. Around 50,000 buildings were re-built & all this expenses were paid by Government.
2. Entry into Euro-zone
Considered by experts as one of the worst decision Greece has ever made. A US economist quoted on the EMU, 1989-2002:-
The euro: It can’t happen, It’s a bad idea, It won’t last.
Greece joined Euro-zone in 2001 which helped it to get loans easily from the Euro-zone banks. But Greece still hasn't paid them back.
3. Olympic hosting turned out as very expensive
Greece was already hit by a huge earthquake which had shaken its economy badly. It didn't have enough money to host Olympics. They took loans from Euro-zone banks in very very big amounts. Organising this huge international event with big loans costed it something around 15 Billion US Dollars.
4. Tampering with statistical data by government to get loans
In 2009, new government was formed. This government's reports revealed that previous government had been understating its deficit figures for years. By this time, Greece had 113% debt compared to its GDP. This was the most by any other Euro-zone country. It got big loans from Euro-zone banks with the help of this wrong reports only. Even after this big revelation, it kept getting loans from banks. It was veering towards bankruptcy.
5. Failed big bailouts
When Greece was experiencing crisis in 2010, the International Monetary Fund, the European Central Bank and the European Commission issued first two international bailouts for Greece. It was more than 264 Million US Dollars. This bailout were supposed to help Greece get time and money to stabilize its economy but eventually Greece failed to do so. The unemployment today is about 25%. The bailout money was all used to pay international loans rather than improving economy.
Conclusion is that, the government of Greece continually failed to improve its economy and still kept getting big loans from the banks. It even failed to use bailout money for fighting with the 2010 crisis which led it to JUNE 2015 Crisis.
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