Greece’s economy on the brink

By admin
14 May 2010

The recent picture of Greece has been one of riots, petrol bombs, teargas and angry protesters – in a country better known as land of leisure.

For months Greece has hovered on a financial knife edge and citizens are are facing lower lifestyle standards.

The European Union and the International Monetary Fund have stepped in to ease the country’s €300-billion (about R2,85 trillion) debt – but that’s bad news for Greek citizens.

The three-year rescue package carries a strict condition: Greeks have to help to get their debt under control, which means huge changes for people who’ve never really had to struggle.

For decades Greece borrowed large amounts from other European states and fattened its happy society. Now like spoilt children Greek citizens are resisting the economic cutbacks. Civil servants have to take a 10 per cent pay and 15 per cent pension cut and pay higher VAT and 10 per cent more in taxes on petrol, tobacco products and alcohol.

For decades Greece lived beyond its means, abusing subsidies from the European Union and creating a culture of fraudulence, self-enrichment and laziness. Public workers get 14 paycheques, with bonuses at Easter and Christmas. Many work from 7.30 am to 2.30 pm and many public employee retire on full pensions before they’re 40.

Civil servants habitually take bribes to do the jobs they’re paid to do. International watchdog Transparency International has named Greece as one of the most corrupt countries in the world – every year about €790 million (about R7,5 billion) is paid in bribes in the public sector.

Tax evasion is also endemic – it’s estimated about €15 billion (R142,5 billion) is lost in this way every year.

Now other euro countries have to cough up the funds to bail out the financially indulgent country – and they’re not thrilled about it. But if they don’t the financial wobbles could spread across Europe – and further.

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