The word crisis is being bandied about a bit too readily however the situation in Greece should be a concern to the rest of the world. Already the national debt of most of the west is spiraling out of control the IMF shows the US national debt is presently 84.26 % of it’s GDP, compared to Australia where the debt to GDP percentage is 17.63 % or Greece where the rate is 115.16 % you start to see a picture of the hard times the country has fallen on. IMF Figures show that Greece has lost 25 % of it’s competitiveness since joining the EU and adopting the Euro as it’s currency. At the end of 2009, the general public deficit reached 13.6 percent of GDP and public debt had increased to 115 percent of GDP. Even with the lower deficits envisaged under the program, the debt as share of GDP will continue to peak at almost 150 percent of GDP in 2013 before declining thereafter.
In past years, Greece’s public sector spending grew, while revenue fell. Then the global recession hit and economic activity slowed and unemployment rose. This exacerbated the fiscal situation.
Financing costs for Greece rose rapidly, adding to the already high debt burden. To stop these snowballing dynamics, the Greek government realized that a strong economic program was the only viable option.
To combat this pubic salaries are being reduced, the retirement age is being raised. Europe is helping, the last stimulus measures have resulted in another 109 billion euros being loaned to bolster the economy and with the austerity measures in place the country looks well placed to repay it’s foreign debt in the future.
The Underdark 