The Crisis
[captionpix align=”right” theme=”elegant” width=”320″ imgsrc=”http://i.telegraph.co.uk/multimedia/archive/02122/greece_2122592b.jpg” captiontext=” The discontent of Greek youth is palpable. Photo: Reuters”]
For the past three years Greece has been going through a huge economic crisis. It is a national test that all the Greek people have to “pass.” The greatest burden, however, falls on the youth of the country as they are expected to come of age and begin their careers in a much more pessimistic economic climate than that of their parents.
On January 1, 2002, Greece and eleven other countries in the Euro-zone acquired one common currency, the Euro. Following this integration, Greek gross domestic product (GDP) continued to grow at rates above the European average, in part because of investment in infrastructure, associated with the 2004 Olympic Games, and because of easy credit access for consumer spending. However, between 2001 and 2005, Greece continually violated the requirements of the Stability and Growth Pact as its deficit to GDP ratio climbed well above the 3% rate established by the Maastricht convergence criteria.
Greece’s fiscal security has continued to deteriorate since late 2009 due to a combination of global economic recession and the local effects of uncontrolled spending. The Greek economy now faces serious problems. It has the second largest annual state budget deficit and the second largest public debt in the European Union.
What’s today’s situation? The new loan agreement for the country resolves the measures included in the agreement between the Greek government and the Troika (a group of representatives from the European Commission (EC), the International Monetary Fund (IMF) and the European Central Bank (ECB).
The conditions that Greece must fulfill until 2015 include: a 15% reduction in main pension insurance for workers in the Public Power Company and national banks; a 7% reduction in pensions for members of the Mariners’ Retirement Fund; and reduction of state salaries at all levels by 22%, and a 32% reduction for employees under 25 years of age. It was further insisted that the maximum duration of collective agreements between unions and employers not exceed three years.
The Economic Future of Greek Youth
At this point it would be appropriate to mention that one of the problems the Greek community faces, and the main concern of young people, is a lack of confidence in the country’s politicians. Corruption and nepotism are issues that have received greater attention during this economic downturn and this, in combination with high levels of unemployment, makes young people want to try and find a different way out of the crisis.
[captionpix align=”right” theme=”elegant” width=”320″ imgsrc=”http://i.telegraph.co.uk/multimedia/archive/02138/greece-afp_2138903b.jpg” captiontext=” An eldery woman begs by the Bank of Greece headquarters in Athens on Tuesday. The slogan on the wall at reads ‘cops, your children will eat you’. Photo: AFP”]
When young people were asked “what are your plans for your future?” as part of a Deal News poll, 36% answered “to create my own business,” 34% “to work as an employee in the private sector,” 10.7% “to move to a rural area and engage in agriculture,” while only 5% desired “to work in government.” Expressing a similar sentiment, 67% of respondents saw the public sector as “the main obstacle to economic development of the country.”
Given that 64% of respondents answered that “unemployment” was the “biggest problem facing young people in the country,” the threat exists that Greece will experience a “brain drain” of its young bright minds. When asked, “if you had the chance, would you leave Greece,” 66% of young people answered “yes,” while only 22% answered “no.”
As a Greek youth, it is true that these circumstances make us even more pessimistic about our future, but at the same time it makes us strive even harder for a just society full of opportunity. We realize in our everyday life that many people have lost their jobs and that recent graduates with remarkable degrees, skills, and potential remain unemployed.
Continental Dimensions
It is also important to examine the European dimension of the problem. Many young people who are skeptical of the EU’s response to the Greek debt crisis refer to the “European responsibility” to assist Greece.
At the same time that Greece tries to settle its debt crisis, there is the persistent threat of wealthy EU members revolting against the Greek rescue package if its conditions are not seen as tough enough. The concern that Athens will fail to meet its targets has caused deep frustration and divided Greek society.
[captionpix align=”left” theme=”elegant” width=”350″ imgsrc=”http://img.thesun.co.uk/multimedia/archive/01455/greek-and-youth-ma_1455088a.jpg” captiontext=” Concern that Athens will fail to meet its targets has caused deep frustration and divided Greek society”]
Since the late-2000s financial crisis, the Euro-zone has established and used provisions for granting emergency loans to member states in return for the enactment of economic reforms. The Euro-zone has also enacted some limited fiscal integration; peer reviews of each state’s national budgets, for example.
So even if the current Greek politicians did not correctly exploit the money entering the country by making real investments in the internal economy, and even if they over borrowed from banks and other countries inappreciably, that doesn’t diminish the responsibility of other members of the Euro-zone.
Speaking at the annual meeting of the International Monetary Fund, the head of the Eurogroup, Jean-Claude Juncker, made a controversial statement: “The Greek crisis could have been avoided, but not with the address of the last or two years, but two or three decades before. I knew that even France and Germany have earned huge sums from their exports to Greece, but I could not say in public what I knew…”
This was a statement that shone new light on the problem and added a new layer to the Greek debate about Euro-zone confidence.
As young people we don’t want to believe that our membership in the Euro-zone was fruitless and that all these years of a flourishing economy were an illusion. It is a fact that the common currency and the cooperation in financial policy were very helpful for our country. It was seen as a great boost to our economic stability and it was the main pillar of our financial activities.
This economic crisis has hit all of Europe hard, not only Greece, so it means that the economic framework which was followed failed. It is up to today’s leaders to make necessary changes to reform basic principles and policies in order to safeguard the economic stability in the future. While lacking a direct role in policy formation, it is the youth of Greece, and the wider continent, that will have to live with the consequences.
Maria Stamatopoulou is a graduate student in the International and European Relations program at the University of Piraeus, Greece. She is a member of Youth Atlantic Treaty Association, interning at the Greek Association for Atlantic and European Cooperation (G.A.A.E.C).
