Greece is a far more willing ‘reformer’ than it is given credit for

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Series Details 31.03.15
Publication Date 31/03/2015
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Although debt restructuring and austerity have defined the debate on Greece and the Eurozone crisis, the role of structural reforms has been less well-understood. Nauro Campos and Fabrizio Coricelli write that this is partly because analysing structural reforms is only possible through a re-examination of the relationship between the EU and Greece, which requires robust ‘counterfactuals’. Presenting evidence from a detailed study of the effect of EU accession on current member states, they write that Greece is the only country that has experienced negative growth as a result of its EU membership, but that this negative effect also shrank after 1995. They argue that structural reforms may offer one explanation for this successful shift.

However, Charalambos Tsekeris in a separate EuroppBlog (see related url) writes that 'The Greek government and its creditors have still not reached an agreement on the release of further financial assistance to the country, despite fears growing over the state of Greece’s finances ahead of a scheduled loan repayment to the IMF on 9 April 2015. While the discussions have focused on a package of reforms that must be approved by the country’s creditors before assistance is released, the nature of the Greek problem goes further than mere fiscal and economic concerns. Many of the issues faced in Greece are fundamentally political and that reforms should go beyond the present narrow focus on competitiveness.

In yet another blog in the same series published in April 2015 Aris Trantidis wrote: 'The present standoff between Greece and its creditors has centred around a package of reforms that must be approved before further financial assistance can be granted to the country. While the focus has been on economics, the real cause of the deadlock stems from the realm of politics: both from the broad ideological commitments both sides have made and from the demands of domestic party politics. The author argued that against this backdrop political rhetoric, such as the focus on Greece ‘spending beyond its means’, or the demand from the Greek government that Germany should pay around €279 billion in war reparations, has obscured the key macroeconomic issues that exist in Greece'.

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Related Links
ESO: Background information: The Greek debt crisis: Key sources
Blog: LSE EuroppBlog, 07.04.15: Greece requires political reform as much as structural reform of its economy
Blog: Social Europe Journal, 01.04.15: Excessive Austerity Not A Lack Of Structural Reform Is Holding Back Investment In Greece
Blog: LSE EuroppBlog, 07.04.15: From war reparations to ‘profligate Greeks’: why political rhetoric is obscuring the real issues in Greece
ESO: Background information: Greece raises World War II reparations issue, Germany unimpressed
The Conversation, 09.04.15: Why we’ve been discussing the Greek bail-out in the wrong way

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