Greece – national flag
The flag was officially introduced in 1822 and reintroduced in 1978, after the country had at times carried a blue flag with a white cross. There are several theories as to why the Greeks just chose blue and white for their flag. The blue color is said to remind the people of the sea and the sky. White symbolizes purity in the struggle for independence, and the cross the Christian faith. The nine stripes correspond to the nine syllables in the Greek war cry for independence: freedom or death.
- Countryaah: What does the flag of Greece look like? Follow this link, then you will see the image in PNG format and flag meaning description about this country.
Greece – history
The following article and its sub-topics deal with the history of modern Greece; for ancient Greece, i.e. the period until approximately 400 AD, see Ancient Greece. See also Byzantine Empire.
- AbbreviationFinder: Check three-letter abbreviation for each country in the world, such as GRC which represents the official name of Greece.
The Byzantine and Turkish periods (approximately 395-1821)
With the definitive victory of Christianity over the former religion, the center of Greek culture was moved from the core area of ancient Greece to Constantinople. During the 600-t. Greek culture totally displaced the Latin, which had existed side by side with the Greek since the founding of Constantinople in 330. Between 580 and 620, Slavic tribes pushed down from the north and displaced the resident population to the mountains and islands off the coasts. Even in the inner Peloponnese existed in the 600-t. Slavic tribes, and the area is mentioned in Byzantine sources under the name Sklavinia. Justinian II, who ruled 685-95 and 705-11, tried to change these conditions. 100 years later, Emperor resumed Nikeforos 1.(802-11) his policy. It consisted of massive population movements of Greek-speaking subjects from Asia Minor to the Peloponnese and Central Greece. To the Byzantine emperors, ancient Greece was the home of Greek culture, which was to be re-Hellenized. The policy succeeded to a large extent, although to this day Slavic tribes have lived in various places in the ancient Greek territory. In continuation of the policy of re-Hellenization, it was important for the emperors to reconquer Crete, which in the 820’s had been conquered by Arab pirates and was not recaptured until 961. Knowledge of ancient Greek culture was preserved during the Byzantine period. In addition, it was the Byzantines who saved large parts of the ancient heritage. Thus were educated people, such as the emperor’s daughter and historian Anna Komnena, familiar with writings such as the Iliad.
In the second half of the 1100-t. became Archbishop Mikael Choniate of Athens. For him, meeting the cultural center of ancient Greece was both a constructive and a disappointing experience. The city was very dilapidated, but its monuments still testified to its grandeur in antiquity. In the late 1100-t. the word Hellenes, which had hitherto meant pagan to the Christian Greeks, was resumed as a term for contemporary Greeks instead of the otherwise commonly used Romans, romer. However, it was in the 13th and 14th centuries that the Greeks seriously rediscovered their ancient roots and linked their culture to the historical sites of antiquity rather than to Constantinople. One of the factors in this development was the downfall of the Byzantine Empire at the conquest of the Crusaders and Venetians during the 4th Crusade in 1204. The whole of ancient Greece came at the division of the kingdom under Frankish, ie. Western European Catholic rule. Athens became a duchy that changed lords several times, and the Peloponnese became a principality, Achaia, under the French family Villehardouin. With this the Greeks came not only under an ethnic but also under a religious foreign domination, as since 1054 there had been a schism between the Roman Catholic Church headquartered in Rome and the Greek Orthodox headquartered in Constantinople.
In northwestern Greece, the trend was different. Shortly after the year 1200, Greek nobles founded an principality in Epirus, which remained under Greek rule for over 100 years. And from western Asia Minor, where at the same time a Greek empire was formed, Greek troops advanced through northern Greece, defeated the Frankish princes and occupied a larger area of the Peloponnese with capital in Mistra near ancient Sparta. From the middle of the 1300-t. this city became the most important in Greek territory. Here unfolded a Greek civilization, which in many ways dates back to antiquity, and whose most important spiritual personality was Georgios Gemistos, a Neoplatonic philosopher nicknamed Plethon. When the Greeks in Asia Minor in 1261 further reconquered Constantinople from the Franks, the city again became the seat of Greek culture, not least visual art.
According to a2zgov, The Greek flowering was stopped by the Turkish (Ottoman) conquest, where Constantinople was conquered in 1453, Athens in 1456. However, at that time there were still Greek territories under Frankish rule. Thus, around the year 1500, the Venetians ruled Cyprus, Crete, and the Ionian Islands. The relationship between Greeks and Venetians was strained by the religious difference, and the Turkish conquest of Cyprus 1570-71 and of Crete 1648-69 was not perceived as a disaster for Greekness. Only the Ionian Islands and an area in the Peloponnese were never occupied by the Turks, but remained under Venetian rule until 1797, when they came under first French, later British rule. The culture of the Ionian Islands therefore came to exhibit a number of characteristics, primarily due to the Italian influence.
| Historical overview | |
| 529 | Justinian 1. closes the Academy of Athens. |
| 580-620 | Immigration of Slavic tribes. |
| approx. 820-961 | Crete occupied by Arabs |
| 1204 | After the 4th Crusade, Frankish principalities are established in the Greek territories with the exception of Epirus. |
| 1204-1669 | Crete under Venetian rule. |
| 1349 | The despot Morea in Mistra is formed. |
| 1354 | The Ottoman conquest of the Balkans begins. |
| 1460 | Mistra capitulates to the Ottomans. Greece during the Ottoman Empire until 1829. |
| 1821-29 | The Greek War of Independence against the Ottoman Empire. |
| 1832 | Greece becomes an independent monarchy. |
| 1843 | Coup. King Otto I introduces parliamentary democracy. |
| 1862 | King Otto I abdicates. |
| 1863 | William of Glücksborg new king as George 1. |
| 1897 | War against the Ottoman Empire. |
| 1912-13 | The Balkan Wars. Macedonia, Epirus and Crete are incorporated into Greece. |
| 1917 | Greece enters World War I on the side of the Entente. |
| 1920-22 | War between Greece and Turkey in Asia Minor. |
| 1923 | Lausannefreden. Population exchange between Greece and Turkey. |
| 1924 | Greece becomes a republic. |
| 1935 | The monarchy is re-established. |
| 1936-41 | Ioannis Metaxas’ dictatorship. |
| 1940 | Italy attacks Greece. |
| 1941-44 | Greece occupied by Germany, Italy and Bulgaria. |
| 1945-49 | The Greek Civil War. |
| 1952 | Greece member of NATO. |
| 1967-74 | Juntatiden. |
| 1973 | The monarchy is abolished. |
| 1974 | Cyprus crisis; the fall of the military junta. |
| 1981 | Andreas Papandreou becomes Prime Minister. Greece Member of the Community. |
| 1994 | Greece blocks the border with Macedonia. |
| 1995 | Greece becomes a full member of the WEU. |
| 1996 | Andreas Papandreou resigns after dominating Greek politics for two decades and laying the foundations of a modern Western European political culture in Greece. |
| 2001 | Greece enters the euzone and Greek drachmas are replaced the following year by the euro. |
| 2004 | Greece is hosting the Olympic Games. |
| 2009 | Financial crisis and state bankruptcy threaten. The international financial lending market is degrading the Greek state’s ability to pay to low levels and economic uncertainty and borrowing rates are rising further. |
| 2010 | The EU, the ECB and the IMF decide to support Greece with a financial loan package totaling 110 billion. Euro. |
| 2011 | Prime Minister Georgios Papandreou resigns in the wake of the financial crisis. |
| 2012 | The Greek parliament adopts another loan package from the EU, ECB and IMF of 130 million. Euro. Political crisis and social unrest are plaguing Greece. |
| 2013 | As part of the reduction policy, redundancies of public employees are intensified. The state television company ERT is closed. |
| 2014 | Greece takes over EU presidency on 1 January. |
AAAAAAAAAAAAA about the Greek War of Independence and Independence 1821-32.
See list of Greek prime ministers and heads of state.
Greece – history (EU and crisis)
After many years of critical EU policy under Andreas Papandreou’s leadership of PASOK (1981-96), a new more social democratic and EU consensus-oriented policy was developed under the new PASOK government leader Kostas Simitis. Under his leadership, the party regained government power in 1996. From the latter half of the 1990’s, tight economic policies continued to be pursued, partly to ensure the country’s accession to European monetary union and partly to increase the competitiveness of the productive industries; the policy, however, triggered strikes and popular protests.
Following the collapse of the Albanian economy in 1997, Greece received hundreds of thousands of illegal Albanian immigrants. At the NATO summit in Madrid in 1997, Turkey and Greece were pressured to sign a peace and non-aggression pact. Following the so-called earthquake diplomacy, in which Greece sent relief workers and aid to the earthquake-stricken areas of Turkey in August 1999, an improvement in relations between the two countries began. In December 1999, Greece refused to exercise its veto against Turkey’s possible accession to the EU if Turkey, in turn, recognized the International Court of Justice’s treatment of their conflicts. In 1999, Greece normalized its relations with Macedonia. That same year, the country demanded an end to NATO bombings of Yugoslavia during the Kosovo crisis.
Member of the eurozone
| Prime Ministers (selected) | |
| 1949-50’sort | Alexandros Diomidis |
| 1950 | Ioannis Theotokis |
| 1950 | Sophocles Venizelos |
| 1950 | Nikolaos Plastiras |
| 1950-51 | Sophocles Venizelos |
| 1951-52 | Nikolaos Plastiras |
| 1952-55 | Alexandros Papagos |
| 1955-58 | Konstantinos Karamanlis |
| 1958 | Konstantinos Georgakopoulos |
| 1958-61 | Konstantinos Karamanlis |
| 1961 | Konstantinos Dovas |
| 1961-63 | Konstantinos Karamanlis |
| 1963 | Georgios Papandreou |
| 1963-64 | Ioannis Paraskevopoulos |
| 1964-65 | Georgios Papandreou |
| 1965-66 | Stefanos Stefanopoulos |
| 1966-67 | Ioannis Paraskevopoulos |
| 1967 | Panaiotis Kanellopoulos |
| 1967 | Konstantinos Kollias |
| 1967-73 | Georgios Papadopoulos |
| 1973 | Spyros Markezinis |
| 1973-74 | Adamantios Androutsopoulos |
| 1974-80 | Konstantinos Karamanlis |
| 1980-81 | Georgios Rallis |
| 1981-89 | Andreas Papandreou |
| 1989 | Tzannis Tzannetakis |
| 1989-90 | Xenophon Zolotas |
| 1990-93 | Konstantinos Mitsotakis |
| 1993-96 | Andreas Papandreou |
| 1996-2004 | Kostas Simitis |
| 2004-09 | Kostas Karamanlis |
| 2009-11 | Georgios Papandreou |
| 2011-12 | Lucas Papademos |
| 2012 | Panagiotis Pikrammenos |
| 2012-15 | Antonis Samaras |
| 2015- | Alexis Tsipras |
Despite tight economic policies, Kostas Simitis regained power over PASOK in the 2000 parliamentary elections. The tight economic policies of the late 1990’s improved macroeconomic production conditions with reduced inflation and interest rates. Along with increased business mergers, but continued modest privatization of public enterprises, large investments (annual average 7%) in infrastructure and new technology, effective planning and management, both agricultural and industrial productivity increased (annual average 2.6%) and competitiveness. This, together with manipulated favorable figures for the state economy, provided the basis for Greece’s entry into the eurozone in 2001 and the replacement of Greek drachmas in 2002 by the euro.
The membership of the eurozone and the subsequent price increases became for many Greeks an ambivalent experience. On the one hand, there was great support among the population for the membership and the increased integration and on the other hand great dissatisfaction with the rising prices of virtually all goods without corresponding wage increases. In the spring of 2003, Greece held the EU Presidency with the following overall political priorities: the accession of ten new members, the implementation of the Lisbon Treaty (later the Treaty of Lisbon), common immigration policy, increased cooperation with the Balkans, Black Sea and Mediterranean countries, the fight against terrorism and organized crime.
Clientelism and financial weakness
After serving in government since 1981, except for the period 1990-93, PASOK was running “tired”, and growing popular dissatisfaction with the PASOK government’s economic policies, economic manipulation, bribery, corruption scandals and close links with business were widespread. Despite the election of a new leader of PASOK, Georgios A. Papandreou, PASOK lost the 2004 parliamentary elections to the conservative party Nea Demokratia (ND) under the leadership of the young Kostas Karamanlis with the promise of pursuing a more genuine “social democratic policy” than PASOK.
| Heads of State | |
| republic Sort | |
| 1827-31 | Ioannis Kapodistrias |
| monarchy | |
| The house Wittelsbach | |
| 1832-62 | Otto 1. |
| The house Glücksburg | |
| 1863-1913 | Georg 1. |
| 1913-17 | Constantine 1. |
| 1917-20 | Alexander 1. |
| 1920-22 | Constantine 1. |
| 1922-24 | George 2. |
| republic | |
| 1924-26 | Pavlos Koundouriotis |
| 1926 | Theodoros Pangalos |
| 1926-29 | Pavlos Koundouriotis |
| 1929-35 | Alexandros Zaimis |
| monarchy | |
| The house Glücksburg | |
| 1935-47 | George 2. (in exile 1941-46) |
| 1947-64 | Paul 1. |
| 1964-73 | Constantine II (in exile from 1967) |
| republic | |
| 1973 | Georgios Papadopoulos |
| 1973-74 | Fedon Gizikis |
| 1974-75 | Michael Stasinopoulos |
| 1975-80 | Konstantinos Tsatsos |
| 1980-85 | Konstantinos Karamanlis |
| 1985-90 | Christos Sartzetakis |
| 1990-95 | Konstantinos Karamanlis |
| 1995-2005 | Kostas Stefanopoulos |
| 2005-15 | Karolos Papoulias |
| 2015- | Prokopis Pavlopoulos |
The holding of the Athens 2004 Olympics led to further price increases, and the completion of the related major infrastructure facilities (motorways, metro, ports, sports facilities, etc.) slowly weakened the Greek economy. Together with increased market liberalization and unemployment of just over 10%, price increases created a growing poverty problem.
The conservative ND government, like the previous PASOK government, failed to implement necessary reforms of the labor market and the public sector, including efficiency and savings in the areas of pensions, health insurance and health. Due to the politicians’ fear of not being re-elected, the widespread political clientelism and opposition from large sections of the trade union movement, the reforms and thus savings in the public sector were postponed.
As bond yields in the international market remained low before the onset of the financial crisis, the government continued to raise ever-increasing loans at home and abroad after re-election in 2007 to cover rising government consumption and deficits. With the onset of the financial crisis in Greece at the end of 2009, the general government deficit exploded to 127% of GDP, well above the 60% limit set by the EU for member states. Despite a debt write-down (haircut) of approximately 100 billion euro in 2012, Greece’s general government deficit was 177% of GDP in 2014.
Foreign policy
In foreign policy, the conservative ND government 2004-2009 largely continued the former PASOK government’s cooperation policy in the EU and NATO, but with increased focus on cooperation with the United States and partial support for the interventions in Iraq and Afghanistan. The biggest foreign policy conflict continued was Turkey’s occupation of northern Cyprusand the disagreements over a 12-mile sea border and the control of the airspace over the Aegean Sea and thus the right to the subsoil and the extraction of any oil and gas deposits. During the period, the positive cooperation with the other Balkan countries continued, especially with Serbia, Albania, Bulgaria and Romania, partly to limit the continued large and illegal immigration to Greece, partly to strengthen Greek investment and energy cooperation. The increased international co-operation was also reflected in Greece’s active membership of the Black See Economic Cooperation (BSEC), founded in 1992. Foreign and trade policy relations with Russia and China improved in the light of increasing trade from 2000 onwards, but the largest trading partners were still Germany, Italy and France. Cyprus andThe former Yugoslav Republic of Macedonia (FYROM) had Greece as its largest trading partner. Relations with FYROM have been partially normalized, but there is still conflict over the use of the name Macedonia, which Greece opposes, citing that the northern Greek territory also has the name Macedonia. The Greek tourism industry attracted more and more foreign tourists from the United States and Europe, but as something new, the number of especially Russian and Chinese tourists increased. Both the 2004 Olympic Games and the 2006 European Melody Grand Prix in Athens supported this development, and in 2009 visited approximately 19.3 million tourists Greece.
Financial crisis and loan package 1
In October 2009, the conservative government party ND called new elections prematurely in an attempt to retain voters, who according to opinion polls had begun to leave the party in favor of the Social Democratic opposition party PASOK due to the policies pursued. ND’s election promises had not been fulfilled and voters punished the party, which went back from 42% to 34% of the vote, while PASOK won the election and went from 38% to 44% of the vote. PASOK formed a new government led by Georgios A. Papandreou with 160 seats in parliament out of 300. The Greek Communist Party KKE went from 6% to 8% of the vote, the new National Conservative and Religious Party LAOS (Popular Orthodox Rally) went from 4% to 6%, while the radical left-wing coalition SYRIZA maintained its 5% of voters.
Upon its accession, the new PASOK government faced the impact of the financial crisis in Greece and a public debt that, due to computational manipulation and rising interest rates on borrowing, had risen to 127% of GDP in the short term, with the prospect of moratorium and possible state bankruptcy. The general government deficit for 2009 of 15.4% of GDP turned out to be the second largest in the world after Iceland. The international financial lending market degraded the Greek government’s ability to pay to a low level, and economic uncertainty and borrowing rates rose further. The improvements promised by PASOK before the election to the economy, employment and welfare state benefits had to be abandoned in favor of cuts that met great resistance in the population with extensive demonstrations, wildcat strikes and violent confrontations with the police.
In order to avoid a possible state bankruptcy and thus aggravation of the crisis throughout the EU area and to limit the losses of lenders (banks, investment companies, private companies and public institutions), the new PASOK government in May 2010 was forced to accept the EU’s demands for large cuts in welfare state benefits, labor market restructuring and privatization of public enterprises in return for the Troika’s (consisting of the EU, the European Central Bank (ECB) and the International Monetary Fund (IMF))’s first economic loan package totaling € 110 billion. Euro. The adoption in the Greek parliament of the first loan package with large public savings took place by a slim majority when many MPs left PASOK and ND.
During 2010-11, it turned out that the first loan package of 110 billion. euro was not enough to save the Greek economy and the financial situation of the Greek state deteriorated. Government debt continued to rise and major savings in the public sector did not materialize. This got leading EU politicians like Angela Merkel and Nicolas Sarkozyto work for a new and different aid package to Greece with even stricter requirements for and control of the Greek state’s economy. In the autumn of 2011, a new agreement was presented between the Troika and the Greek government with effect from February 2012. It included a new loan package totaling DKK 130 billion. euro and a subsequent agreement on a 53% write-down of the Greek government debt to private lenders, corresponding to approximately 100 billion euros out of a total government debt of approximately 350 billion Euro. The agreement also included a continuous monitoring of the Greek state economy by EU technocrats, so that the loans were to be disbursed in installments as the reforms and savings were implemented.
Unrest and strikes
The new strict requirements for the Greek government on cuts in public spending and increase in state revenues through expansion of the tax base and increased tax rates created new unrest in the country. Very large demonstrations and strikes as well as IndignantsThe movement’s long-standing occupation of Syntagma Square in front of the Greek Parliament prompted Prime Minister Georgios Papandreou on 31 October 2011 to propose a referendum on the new loan package containing very large public savings. This proposal sent a shock wave through the European political and economic elite, who feared a Greek no to the agreement and thus a real possibility of state bankruptcy, Greek exit from the eurozone and unforeseen consequences for the eurozone, the EU and the international crisis-stricken economy. The result was that Papandreou withdrew his proposal in exchange for the conservative opposition party Nea Demokratia supporting the comprehensive troika-dictated austerity policy. At the same time, a proposal was put forward supported by the Conservative opposition leader Antonis Samaras and the Troika, that Papandreou should resign as head of government and be replaced by a transitional head of government.
Before resigning as head of government, Papandreou won a vote of confidence in parliament by a very slim majority as even more of PASOK’s MPs left the party. On 11.11.2011, a new so-called technocrat-government leader Lucas Papademos, former adviser to Papandreou, former vice-president of the ECB and former president of the National Bank of Greece, was installed. He formed a time-limited coalition government representing PASOK, ND and the religious, national conservative party LAOS (Popular Orthodox Rally), which had won 6% of the vote in the 2009 election. In opposition were the Greek Communist Party KKE and the left-wing radical coalition SYRIZA.
Adoption of loan package 2 and new cuts
In February 2012, the Greek Parliament adopted the second loan package from the Troika of 130 billion. Euro; a package that was to run until the beginning of 2014. It contained 20-40% cuts in salaries and pensions for public employees, redundancies of up to 150,000 public employees out of a total of 875,000, of which 183,000 contract employees, drastic cuts in welfare state benefits in the social, health and education areas, as well as demands for liberalization and flexibility of the private labor market, including wage and pension reductions. The troika also demanded the sale of large and small public enterprises as well as increased tax revenues through new uniform tax laws, streamlining of the tax system and the collection of taxes, not least from the many tax evaders, who for years had failed to pay tax to the tune of billions that could cover the government deficit annually. Finally, demands were made for streamlining the legal system. This agreement triggered in April 2012 onwards a new and comprehensive mobilization of the population facing the government’s and the Troika’s austerity policies, rising unemployment and rising poverty. The protests were ignited by the suicide of an elderly Greek in front of parliament as an expression of direct protest against the cuts.
Despite two large loan packages of DKK 110 billion, respectively. and 130 billion. euro and large savings on government spending, the Greek debt crisis continued and developed into the private sector as a real economic crisis with an average fall in GDP of minus 5% per euro. years in the period 2008-13. The general government deficit was actually minus 9.4% in 2011 and minus 6.6% in 2012. Total government debt grew to 157% of GDP in 2012 and further to 177% in 2014 due to high interest burden, declining competitiveness, lower tax revenues, previously risky lending, collapse of the national financial sector and recapitalization of Greek banks paid for by the Treasury and EU loans. Greek banks, universities, pension funds and other institutions that had invested their wealth in Greek government bonds were on the verge of bankruptcy, en The Troika halved the value of Greek government bonds. Unemployment rose and became the highest in the EU with 27.5% unemployed in 2013 (65% for young people aged 15 to 24). Until 2014, official poverty increased to over 35% of the population, while 41% of children lived in poverty.
| Unemployed in Greece as% of population (2014) | |
| Unemployed in total | 26.5% |
| Young unemployed | 51% |
The previously strong social relations in Greek society were under strong dissolution, many Greek families could not feed themselves and could not afford houses and homes. The number of homeless increased both for poor Greeks and for the many hundreds of thousands of illegal and legal refugees and immigrants. The Greek asylum system collapsed, and despite EU support for border surveillance, large-scale immigration continued in the 2010’s, with Greece, along with Italy, Malta and Spain, trying to pressure the rest of the EU to either completely shut down immigration or divide immigration and asylum seekers. between them.
Political crisis, fraud and scandals
In the wake of the economic crisis followed a political crisis in which more and more Greeks lost confidence in the political democratic system and politicians. On the one hand, it meant a polarization of the political landscape with great support for the left-wing radical party SYRIZA and for the neo-fascist and right-wing radical party Gyldent Daggry. On the other hand, more and more Greeks saw the political and administrative elite as a corrupt elite who only thought of being re-elected in order to milk the treasury for money for their own consumption and to bribe the electorate through the employment of eg 100,000 public employees, such as ND did in the period 2004-09.
The political and administrative clientelism and the many tax evaders who have dominated Greece for many years had come under criticism in recent years. Governments were forced to focus on widespread corruption, including among their own ranks, which has resulted in extensive accusations and lawsuits, where, for example, former PASOK defense minister Akis Tsochatzopoulos (b. 1939) and his family have been sentenced to long prison terms for receive return commission for government procurement of German submarines and other military equipment. This corruption scandal has since developed with new accusations against 32 German and Greek individuals. Money spent on bribery in this so-called submarine case has cost the Greek state approximately 60 million Euro.
Another example is the Lagarde scandal, in which both Conservative (ND) and Social Democratic (PASOK) finance ministers, government officials and approximately 2000 others are accused of covering up and even having made illegal money transfers to Swiss banks, partly to save the illegal return commissions, partly to avoid paying taxes. The list of persons involved in the scandal were given to Greece by the then French Economy Minister Christine Lagarde.
A third corruption scandal involves the German company Siemens, which is accused of bribing German and Greek individuals, officials and companies, so that Siemens could get a billion contract with the state-owned Greek telecommunications company OTE regarding. digitization of the Greek telecommunications system. The study started in 2006 and has not yet been completed. The Greek state is believed to have lost approximately 80 mio. euros in the bribery case.
In 2015, the Canadian-owned mining company Eldorado Gold was accused of moving its profits from Greece to the Netherlands in order to avoid paying taxes in Greece. This scandal put Dutch Finance Minister Jeroen Dijsselbloem (b. 1966), who was also chairman of the Eurogroup’s finance ministers, in a dilemma when he also demanded action against tax evasion in Greece before the Greek government could get a new loan agreement with the EU.
Greece has increasingly been characterized by legislative chaos, with the political elite since 1974 adopting an average of 2,800 laws per year. years, a very high number compared to other countries. Many of these laws are more or less in conflict with each other and are the result of different party political and clientelistic interests. The political-administrative clientelism, the harsh austerity policies of the Greek government and the Troika, have in the last few years changed the people’s overall relationship with the EU from being very positive to being strongly negative. At the same time, the many economic scandals have confirmed the population’s distrust of the traditional parties, not least the Social Democratic PASOK and the conservative ND.
After about half a year with Papademos as technocratic head of government, new elections were called in May 2012. This election was fatal for the two old parties PASOK and ND, who had alternately held government power since the military junta left in 1974. 13% of the vote, ND from 34% to 19% and the religious, national conservative party LAOS were not elected. The two old parties and LAOS, which had supported the Troika’s austerity policy, were punished very harshly by the electorate. Many former PASOK voters and other dissatisfied citizens voted for either the left-wing radical coalition SYRIZA, which went from 5% to 17% of the vote and became the second largest party, or to the newly formed party, the Democratic Left (DIMAR), which received 6%. The newly formed right-wing and religious party Independent Greeks (ANEL) entered parliament with as much as 11%, while the biggest shock was the election of the right-wing radical and neo-fascist party Golden Dawn (Chryssi Avgi), which received 7% of the vote. Neither ND, SYRIZA nor PASOK could form a new government, which is why new elections were called for 17.6.2012.
Conservative/Social Democratic Coalition Government 2012
In the face of continuing economic crisis, political chaos, social misery and strong political announcements from the Troika and German Chancellor Angela Merkel to vote for the parties that supported the agreement with the Troika (EU / ECB/IMF), ND became the largest party with just over 29% of the vote, followed by the radical left-wing coalition SYRIZA with 27%, PASOK with 12%, DIMAR with just over 6% and the Greek Communist Party with 4.5%. The religious and right-wing Independent Greeks (ANEL) party lost 7% of the vote, while the neo-fascist party Golden Dawn maintained a small 7% of the vote. The new government took office on 20.6.2012. Despite strong opposition from the population to the Troika’s austerity policy (about 80%), around 50% of voters still voted for parties,
Following further pressure from EU political leaders, the financial world and the United States, the election result was transformed into a new coalition government led by Antonis Samaras (ND) with the support of PASOK and DIMAR, whose political leaders did not directly participate in government but only their elected technocrats. The coalition government only lasted until the late summer of 2013, when the small SF-like party DIMAR left the government. The conservative ND and the Social Democratic PASOK were forced by the political circumstances to even closer cooperation. Samaras continued as head of government, and PASOK entered fully into the new and smaller coalition government, with PASOK’s leader Evangelos Venizelos (b. 1957) becoming the new Deputy Minister of State and Foreign Minister.
Greek economy 2008-14
With the new coalition government, which supported the Troika’s borrowing package and austerity policy in Greece to keep the country in the eurozone and the EU, there was a certain calm vis-à-vis the EU and the financial market, while internally in Greece until 2014 there was continuous social unrest. between general strikes, industry strikes and demonstrations. Following further pressure from the Troika, dismissals of public servants intensified, although there was still disagreement over the closure and/or privatization of state-owned Greek companies in the arms and aircraft industries, shipyards, electricity and mining industries. The former state-owned airline Olympic Air was taken over by the privately owned Aegean Airline in October 2013 with a total fleet of 45 aircraft and 2,000 employees. The dismissals of public employees culminated with the closure of the state television company ERT in the autumn of 2013. Many of the approximately 3,000 employees occupied ERT’s headquarters in Athens and regional stations, from which they broadcast their own television and radio programs, all the while the Conservative-led government set up a new Greek radio, Internet and television company (NERIT).
The closure of ERT led to further weakening of the coalition government when the small party DIMAR left the government and when the Social Democratic PASOK was internally divided over the matter. This weakening and division of the coalition government made it difficult to implement agreed reforms with the Troika on privatizations of public enterprises and further cuts in public spending. Throughout 2014, the coalition government was simply afraid of losing its slim majority.
The Greek economy showed little sign of improvement during 2014. While GDP had fallen annually by an average of approximately 5% between 2008 and 2013, then for the first time since 2008 there was a small increase in GDP of 0.8% from 2013 to 2014. But overall, Greek GDP fell from 242 billion. euros in 2008 to 179 billion. euros in 2014, corresponding to a total decrease of 63 billion. euro or just over 25%. The chronic trade deficit was on average minus 7% in the period 2004-13, but for the first time in 2014 showed a small increase of 1% compared to 2013. The Greek balance of payments deficit in the period 2004-12 was on average 10 per year. % with a slight increase of 0.6% in 2013 and one of 1.2% in 2014, the first in almost 50 years. The improved balance of payments was not least due to a sharp increase in the number of tourists, which increased from DKK 19 million. in 2009 to 22 million. in 2014. The majority of tourists came from other EU countries while 1.2 million. came from Russia and ½ million. From usa.
The total government debt developed from DKK 183 billion. euros in 2004 to 265 billion. euros in 2008 and on to 356 billion. euros in 2011. After a debt reduction (haircut) of approximately 53% for a number of private investors, corresponding to approximately 100 billion of the government debt, in connection with the second loan agreement in 2012, the total government debt still ended up rising to 315 billion. euros in 2014. The debt write-down meant large losses for Greek pension funds, universities and other private investors. In% of GDP, total government debt increased from 99% in 2004 to 177% in 2014, partly due to continued borrowing and partly due to the actual decline in GDP after 2008.
Despite the recovery of the Greek economy, unemployment remained the highest in the EU. It had increased from 7.6% in 2008 to 27.5% in 2013 and then decreased to 26.5% in 2014. For young people between the ages of 15 and 24, it decreased from approximately 65% to 51%. The fall in unemployment is only partly due to the creation of new jobs, but to a greater extent to a reduction in the registered labor force, where especially young people (approximately 180,000) with a high level of education emigrated. The largest decline in employment was in the secondary sector (industry and construction), which in 2008 represented 22.3% of employment decreasing to 14.9% in 2014, while employment in the tertiary sector (service, tourism) increased from 66.4 % in 2008 to 71.6% in 2014. Since 2010, there has been an average decrease in labor costs of minus 3.3% per. years, while inflation has been on average minus 1,
The result of the extensive cuts in public spending after 2010 has been a continuing economic and social crisis, but for the first time in many years there was also a primary budget surplus (minus loan repayments) of approximately 1.5% of GDP in 2013 and 2014. However, these surpluses in the central government budget are not enough to cover the central government’s current expenditure on loan and interest repayments and, according to the IMF, will not be until 2020. Therefore, new loan packages with lower borrowing rates are expected and possibly debt restructuring/debt reduction (haircut) to bring the Greek government debt down to a so-called sustainable level of around 120% of GDP by 2020.
Right-wing extremism and Golden Dawn
Immigration to Greece was still high at the end of 2013, and officially there are approximately ½ mio. legal and approximately ¾ mio. illegal immigrants in the country. The continuing rise in poverty, the reduction of the minimum wage in May 2013 by 22% to 586 euros and continued high immigration formed the basis for further support for the right-wing radical, neo-fascist party Gyldent Daggry, which in the late summer 2013 polls stood at 12-15% of the vote and to become the country’s third largest party. Extensive xenophobia has developed in Greece led by Golden Dawn, which persecutes, abuses and murders immigrants. With the murder, carried out by a member of Golden Dawn, of the anti-fascist Greek rapper Pavlos Fyssas on 17 September 2013 in a poor working-class neighborhood in Keratsini (Piraeus), where Golden Dawn has great support, the Greek public was shaken, and the party’s support was halved in opinion polls to 6-7%. The Conservative Social Democratic government was forced to intervene, and 32 arrest warrants were issued against leading members of Golden Dawn. The leader of the party Nikolaos Michaloliakos (b. 1957), the majority of parliamentarians and several local party leaders were imprisoned on charges of leading a criminal organization responsible for murder, violence, illegal possession of weapons, extortion, money laundering, cigarette smuggling, etc. Shortly afterwards, the Greek parliament decided to suspend state party support for the party. In parallel, a number of officers in the police and the army were dismissed due to their affiliation with Golden Dawn. On November 2, 2013, four of Golden Dawn’s paramilitary guards in front of the party office in Athens’ northern suburb of Neo Iraklio were attacked. Two were killed and one seriously injured, while a fourth escaped. This created further fears in the Greek population of civil war-like conditions between the extremist right and the extremist left, as the assassination is seen as a possible left-wing extremist revenge action for the murder of the anti-fascist rapper Fyssas. Detention of the majority of Golden Dawn’s MPs and others has meant a weakening of Golden Dawn’s political action, and their violent actions in public space have subsided. However, after a maximum of 18 months in custody, the leading members of parliament have been released and have recently taken an active part in parliamentary work. The entire lawsuit, where approximately 70 people are accused of leading a criminal organization, have been postponed several times.
Immigration and trade policy
In the period leading up to Greece’s takeover of the EU Presidency in January 2014, disagreements continued over the continuation of the Troika’s austerity policy and the CAP (CAP). There was a growing demand for the EU to replace cuts with investment in private and public jobs, including demands for special support agreements in the field of agriculture for small farms, such as tobacco farmers and organic farming. The Greek Presidency formulated a priority for the EU’s policy areas for the first half of 2014. Overall, it aimed to strengthen economic growth in the EU through investment and job creation in infrastructure, energy and climate. The presidency called for a stabilization of the euro, national economies and state budgets, as well as banking union and further social inclusion. Particular emphasis was placed on a revision of the EU’s immigration policy, so that all EU countries should take their share of refugee immigrants, including a common and effective fight against illegal immigration. Even after the appointment of former Greek Minister Dimitris Avramopoulos (b. 1953) as EU Commissioner for Refugees and Immigrants in November 2014, there have been no significant changes in EU policy in this area. The southern European and crisis-stricken countries continue to face the biggest immigrant problems, and the flow of refugee immigrants to Greece tripled in the first three months of 2015, with more than 10,000 illegally finding their way to Greece via the south-eastern Mediterranean. Even after the appointment of former Greek Minister Dimitris Avramopoulos (b. 1953) as EU Commissioner for Refugees and Immigrants in November 2014, there have been no significant changes in EU policy in this area. The southern European and crisis-stricken countries continue to face the biggest immigrant problems, and the flow of refugee immigrants to Greece tripled in the first three months of 2015, with more than 10,000 illegally finding their way to Greece via the south-eastern Mediterranean. Even after the appointment of former Greek Minister Dimitris Avramopoulos (b. 1953) as EU Commissioner for Refugees and Immigrants in November 2014, there have been no significant changes in EU policy in this area. The southern European and crisis-stricken countries continue to face the biggest immigrant problems, and the flow of refugee immigrants to Greece tripled in the first three months of 2015, with more than 10,000 illegally finding their way to Greece via the south-eastern Mediterranean.
In terms of trade policy, Greece continued to work on strengthening energy cooperation with the countries of south-eastern Europe and the EU-Mediterranean, including cooperation with Cyprus and Israel on a Free Economic Zone for oil and gas extraction in the south-eastern Mediterranean in partial conflict with Turkey and Turkish-occupied northern Cyprus., which also claims the right to the subsoil.
Other collaborative projects include the Burgas-Alexandroupolis oil pipeline with Bulgaria and Russia and the Trans Adriatic Pipeline (TAP) with Turkey, Albania and Italy. If realized, the Trans Adriatic Pipeline could supply the EU with natural gas from Azerbaijan (the Shah Deniz gas field) via the Turkish Trans Anatolian Pipeline to Greece and Albania and on to Italy. The Norwegian Statoil, the Swiss Axpo and the German E.ON-Ruhrgas are the main shareholders in the company. A project that could create thousands of jobs in Greece.
The conflict with the former Yugoslav Republic of Macedonia (FYROM) over the use of the name Macedonia remains unresolved despite ongoing negotiations under the auspices of the United Nations.
Cooperation with China and Russia has intensified, in particular as regards tourism and the possible acquisition of Greek state-owned enterprises in the fields of infrastructure (ports and railways) and the energy sector. The Russian Gazpromis interested in taking over the Greek gas company DEPA, while other Russian companies are interested in taking over Greek railways and parts of the port of Thessaloniki. China wants to buy and expand Piraeus’ container port as a strategic hub for the distribution of Chinese goods in Europe, North Africa and the Middle East. Trade with Russia has increased significantly in recent years, reaching a total amount of 6.5 billion. US- $ in 2012, but fell sharply in 2014 due to EU sanctions against Russia and Russian halt to imports of agricultural products from EU countries, including from Greece. In 2014, Greek exports went primarily to Turkey, Italy, Germany and Bulgaria, while imports came primarily from Russia, Germany, Italy and China. The largest trading partners in 2013-14 continued to be Germany, Turkey, Italy and Russia.
Relations with Germany have formally been good, but in reality there is great dissatisfaction with the extensive German exports to Greece and thus a great inequality in the trade balance between the two countries. The Greek public is very critical of Angela Merkel’s power in the EU and demands for continued cuts in Greece in support of German companies’ expected acquisitions of Greek state-owned companies, including the German FragPorts acquisition of 14 regional airports to servicing and earnings from an increasing number of German tourists. The criticism of Germany also applies to the fact that the Greek banking sector has been recapitalized for up to 50 billion. euro paid by Greek taxpayers through cuts in the public sector, while the German banks, which before the 2008 crisis provided large and unsecured loans to Greek banks,
Left-wing government and confrontation with the EU 2015
The left-wing radical coalition SYRIZA, formed by 13 small left-wing organizations in 2004 with Synaspismos (SYN) as the largest, was transformed into a unified party at a congress in Athens in July 2013 under the leadership of 39-year-old Alexis Tsipras. SYRIZA was reorganized and given a so-called “shadow government”, which increasingly sought international contacts also with political opponents in Europe and the United States. The party coalition, which first entered parliament in 2004 with 3% and 6 seats, stood in 2013 as a competitor to the governing party Nea Demokratia to become the country’s largest party.
However, the party did not gain a majority in the June 2012 election, but became the second largest party with 27% of the vote and 71 seats in parliament out of 300. In the ordinary election of a new president in Greece at the end of 2014, the incumbent Conservative and Social Democratic government did not get the required majority of 180 seats and therefore had to resign and call new elections to parliament. In the subsequent election on 25 January 2015, SYRIZA received 36.3% of the vote and 149 of the 300 seats in parliament, becoming the largest party, but without being able to form a government alone. As something completely new in Greek politics, Alexis Tsipras secured a majority by sharing government power with the right-wing Greek Independent Party (ANEL), which won 4.7% of the vote and 13 seats in the election.
From day one, the new government was met with fierce opposition from EU bourgeois and social democratic parties, which threatened to stop all financial support, including loans to the Greek state, if it did not follow the outgoing government’s agreements with the Troika. After long and rhetorically very violent negotiations, not least in public, between the new Greek Finance Minister Yanis Varoufakis (b. 1961) and the Eurogroup Finance Ministers, led by the Dutch Finance Minister Jeroen Dijsselbloem and the German Finance Minister Wolfgang Schäuble, on 20 February 2015, a preliminary agreement was reached between the new Greek government and the EU institutions on a limited “loan agreement” of four months until 1 July 2015. Before then, the parties were to agree on a comprehensive reform program for the Greek economy, including emphasis on combating the humanitarian catastrophe, combating tax evasion, modernizing the public sector, including the legal system, partial privatization of public enterprises, new investment in infrastructure and the private sector within the framework of an annual primary budget surplus for the state of 1, 5%.
As part of the struggle to put public discourse in the EU on the causes and responsibilities of the economic crisis in Greece, Germany has primarily sought to portray Greek society as sick and the Greeks as lazy and overcrowded. The German press, with great support among bourgeois politicians and in the general population, has spoken of the Greeks as parasites who live high on German loans to Greece, which the German taxpayers pay. The fact that Greece has only borrowed and not received money from Germany, on the other hand, is not part of the public discourse. Conversely, parts of the Greek press and popular demonstrations in Greece have portrayed leading German politicians such as Merkel and Schäuble with Hitler mustaches and Nazi uniforms; a symbol for the Greeks of yet another German occupation and plunder of Greece. In response to criticism from Germany, the new Greek government has said it will repay all loans, but has at the same time agitated for the Greek debt to be written down to a sustainable level, with reference write-down of the German debt after World War II. In order to put pressure on Germany, the Greek government has also completed a study of German war damages to Greece, which totals 280 billion. Euro.; compensation and forced loans, which Germany refuses to pay. In order to put pressure on Germany, the Greek government has also completed a study of German war damages to Greece, which totals 280 billion. Euro.; compensation and forced loans, which Germany refuses to pay. In order to put pressure on Germany, the Greek government has also completed a study of German war damages to Greece, which totals 280 billion. Euro.; compensation and forced loans, which Germany refuses to pay.
| The result of the parliamentary elections on 25 January 2015 compared to the June 2012 elections | |||
| Party | 2012 | 2015 | Seats in Parliament after 25.1.2015 |
| SYRIZA | 26.9% | 36, 3% | 149 |
| ND | 29.7% | 27.8% | 76 |
| Golden Dawn | 6.9% | 6.3% | 17 |
| Potami | 6.1% | 17 | |
| KKE | 4.5% | 5.5% | 15 |
| ANEL | 7.5% | 4.8% | 13 |
| PASOK | 12.3% | 4.7% | 13 |
| KIDISO | 2.5% | Below the threshold | |
| The largest party gets 50 extra seats out of the 300 seats in parliament. The overall turnout increased by 1.4 percentage points from 62.5% in 2012 to 63.9% in 2015. The election result shows that the critical EU parties (Syriza, DG, KKE, ANEL) together received 52.9% of the votes against 45.8% in the 2012 election, while pro-EU parties (ND, PASOK and Potami) got 38.6% against 42.0% in the 2012 election. | |||
The short election campaign leading up to the election on 25 January 2015 will historically be remembered for a number of special circumstances. First, that the election became a question of for or against the troika-dictated cuts in Greece, ie. a choice between for or against EU, ECB and IMF borrowing and cutting packages. Second, the widespread demonization of political opponents and threats of chaos. This was especially true of the widespread threats of the incumbent Conservative and Social Democratic coalition government to the people that if they voted for far-left and right-wing parties opposed to the Troika-led austerity policy, Greece would go bankrupt, withdraw from the eurozone and the EU, and the crisis and unemployment would be even greater. This threat picture was quite obvious and very unusually supported by leading politicians in the EU, Germany and other countries where normal practice had been that the EU does not interfere in national elections. The result of these threats and demonizations was counterproductive, with more voters than expected leaving the two old parties ND and PASOK responsible for the cuts, voting either for EU-critical parties on the left and right or for newly formed parties such as the center-liberal Potami. (River) and the so-called new Greek Social Democracy KIDISO (Movement of Democratic Socialists), which under the leadership of the former PASOK head of government and chairman Georgios Papandreou 3.1.2015 had formed its own party.
With the new left-wing-led coalition government after the election on January 25, 2015, a new president was first elected in the country. As a compromise, the new coalition government recommended the former Conservative Interior Minister Prokopis Pavlopoulos (b. 1950) from the Nea Demokratia party, and he was elected with 233 out of 300 votes in the Greek parliament in February 2015 and later installed as president on 13.3.2015. Secondly, a more critical policy towards the EU, Germany and Turkey has been pursued and enhanced cooperation with Russia and China has been launched in the form of a new multidimensional foreign policy within the framework of NATO and continued cooperation with the United States. With expanded cooperation with Russia on the one hand and with the United States on the other, the Greek government sought to put pressure on the EU’s conservative and liberal leadership and their continued demands for cuts in Greece. As part of the new foreign policy, the government set out for increased cooperation between the southern European countries in the EU in order to balance the balance of power within the EU between south and north. Foreign policy should increasingly be borne by the country’s special geopolitical location and so-called peace-building role. the conflicts between the EU/US on the one hand and Russia on the other over the situation in Ukraine and the wars in the Middle East. As part of the new foreign policy, the government set out for increased cooperation between the southern European countries in the EU in order to balance the balance of power within the EU between south and north. Foreign policy should increasingly be borne by the country’s special geopolitical location and so-called peace-building role. the conflicts between the EU/US on the one hand and Russia on the other over the situation in Ukraine and the wars in the Middle East. As part of the new foreign policy, the government set out for increased cooperation between the southern European countries in the EU in order to balance the balance of power within the EU between south and north. Foreign policy should increasingly be borne by the country’s special geopolitical location and so-called peace-building role. the conflicts between the EU/US on the one hand and Russia on the other over the situation in Ukraine and the wars in the Middle East.
At meetings with Putin and Medvedev in Moscow in April 2015, the new Prime Minister Tsipras entered into preliminary agreements with Russia on support for natural gas pipelines from Russia via Turkey to Greece, lowering of Russian natural gas prices to Greece and Russian investment in Greek infrastructure and possible opening of Greek agricultural exports to Russia. for the twenty largest Greek agricultural exporters.
After just three months with government power and fierce political confrontations with the EU, the government stood with a support of the electorate of 40-45%, and head of government Tsipras with a personal support of approximately 70%. A support that was far greater than the election result from 25.1.2015 stated. At the same time, the old governing parties ND and PASOK had been severely weakened. The PASOK Social Democrats were split into two parties in January 2015, while Samaras ‘ leadership of the conservative ND was threatened by internal power struggles between Samaras’ right wing and Karamanlis ‘ and Dora Bakoyannis’ (b. 1954) center wing.
Loan negotiations 2015 in a tight knot
In February, the parties to the Greek loan agreement had agreed to extend the loan until 1.7.2015, while a reform program for the Greek economy was agreed. The Greek government was opposed to the reform terms of the lenders, as they were linked, according to Greece, to excessive unilateral cuts in public spending that would affect the general population, and as the agreements had exacerbated the economic and social crisis. Moreover, according to the Greek government, the loan agreements were far too expensive. For example, since the first loan package in 2010 until 2015, the IMF alone had an interest income of DKK 2.5 billion. and expected to earn a total of 4.3 billion. euro on Greek loans until 2024. The majority of loans to Greece have been converted to euro countries since 2012, and here, for example, Germany has had an interest income of 360 mill. euros on loan to Greece and expects to earn 20 million in the future. euros per year. The demands of the Greek government were to lower the loan interest rate by 3.6% to something reminiscent of the actual cost of the loans of approximately 1%. At the same time, lenders demanded that Greece show some form of willingness to reform in return for a new agreement.
In June 2015, the loan and reform negotiations broke down and it became clear that the agreement would not be extended further. Furthermore, on 28/6 the European Central Bank no longer decided to raise the limit on emergency loans that the Greek banks could have obtained from the Greek central bank. As a result, and to avoid a collapse of the banking system, the Greek banks closed for three weeks and an ceiling was introduced for the Greeks so that a maximum of 60 euros a day could be raised.
On 5 July 2015, Alexis Tsipras conducted a referendum and received solid support from 61% of the population to reject the Troika’s reform terms for further loans. In new negotiations with the EU, the International Monetary Fund and the European Central Bank, Tsipras applied for a three-year loan of 86 billion. euro and agreed to reforms that were albeit even tougher than those rejected in the referendum. After several rounds of negotiations, the parties agreed in August 2015 on the new loan agreement. Tsipras called shortly after the election in hopes of securing a stronger seat in the Greek parliament, and on September 20, 2015, SYRIZA won the parliamentary election with 35% of the vote ahead of the ND’s 28%. Tsipras was thus able to continue as Prime Minister with the support of the Independent Greeks (ANEL).
Future challenges
The biggest challenge for the new Greek government will in future continue to be negotiations with the EU, the ECB and the IMF on sustainable loan agreements with possible restructuring and/or reduction of loans. The powerful political elite of the EU must balance between pressure on the Greek government not to make excessive concessions that could spread to other southern European countries, and consideration of the danger of a Greek state bankruptcy that could lead to Greece leaving the eurozone and thus create uncertainty about the future of the euro.
Another crucial challenge will be to find a solution to all the unpaid so-called “red loans” that hundreds of thousands of Greek citizens and small businesses had taken out before the crisis hit in 2009, as well as securing cash in the Greek banks that have lost huge sums due to the financial crisis and the housing bubble in Greece. Hundreds of thousands of Greeks took out cheap loans in Greek banks to buy homes, cars and low-interest securities from the late 1990’s until the onset of the crisis in 2009. The following years, well over a million Greeks became unemployed and therefore could not repay their loans to the banks. Many banks went bankrupt and others were merged, while four large systemic banks survived by being recapitalised with just over DKK 50 billion. from the loans granted by the Troika to the Greek State, and which Greek taxpayers will have to repay in the long run. It was many billions of euros that the Greek banks had to transfer to, among other things, reinsurance. German and French banks, so that they avoided bankruptcy.
A third crucial challenge for the new Greek government will be to implement a series of socially balanced reforms that can counteract the social catastrophe and boost employment without increasing government spending. It requires both private and public investment and probably as much EU investment from the European Investment Bank and the European Investment Fund in strategic and sustainable industries from organic farming, modern mining, information technology and renewable energy shipping (solar, wind and water), tourism, infrastructure, education and probably as much as small and medium-sized enterprises. The introduction of social reforms also applies to the restructuring and simplification of the pension system, where approximately 45% of all pensioners (1.2 million) live below the poverty line.
A fourth challenge is the fight against tax evasion and the introduction of a new socially balanced tax system, in which the many wealthy Greeks and large national and international companies have to pay proportionate taxes. Today, citizens and companies together owe approximately 76 billion euros in tax and how this money is recovered is in itself a major challenge for the new government. To this must be added a fight against corruption and the clientelist system, in which leading politicians and officials misuse state funds to either bribe select voters, organizations and companies or to enrich themselves. According to the Greek Ministry of Finance, this is up to 12 billion. euros, which are spent every year on “maintenance” of the client list system.
Finally, the Greek government is facing a major and potentially conflicting task of restructuring, democratizing and modernizing the labor market, as the previous government had weakened the agreement system through increased liberalization and flexibility, as well as the abolition of a number of employee benefit schemes. This challenge is both about creating new jobs in the private sector, but also about re-hiring public servants who were fired under the previous government. Here, the closure of the state radio and television company ERT and the dismissal of 3,000 employees in the autumn of 2013 became a symbol of the previous government’s policy. In April 2015, the new government presented a bill to restore ERT with a maximum of 2,500 employees and implemented the first step in re-establishing the minimum wage at 650 euros per year. 1.10.