The Greek financial struggle with the Euro in recent, at
least 5 years, became a subject of many heated discussions in Europe and in the
US. Everybody has an expert
opinion on why GREXIT (Greek exit from the Euro Zone) would be a disaster to
the economies of the World.
Greece was admitted to the Eurozone in 2001. The discussion on the Greek chances to
succeed started right away and never stopped. Greek economy seemed a bit ‘incompatible’ with the Euro.
I have been a long time supporter of the theory, that the
week, traditional economies shouldn’t enter the Eurozone, since they (if they
encounter the problem with cost of goods production) loose the ability to
manipulate the value of their currency, and instead they have to respond to all
the particularities of the Euro, set and enforced by the biggest and strongest
economies, like Germany, France etc (*1).
And all that happens without the benefit of the Greek people.
However, this is not my argument at this moment. Greece has been admitted to the Eurozone,
and should stay there, even though in the minds of the common people in Europe,
Greece is the Least Hardworking, and the Least Trustworthy country in the
European Union… (*2).
Greece tries to renegotiate terms of the debt payment, as
well as the new, significant loans.
International banks, exposed to the Greek debt, try to impose the harder
austerity measures on the Greek nation.
This doesn’t sit well with the nation, which for years have been
suffering dire straits and increasingly worsening social services. So, on Sunday, July 5, in the
country-wide referendum, Greek people rejected the farther going austerity
measures. They do not want to go
out of the Eurozone, but to get new help and try to return to the normal lives,
if it’s at all possible…(*3).
Both sides try to play ‘hard ball’, no one is ready to give
in… and definitely Europe doesn’t want to increase the exposure to the new
Greek debt.
There is another, political aspect of this ‘game’. In the middle of June this year, while
the Greek Prime Minister Alexis Tsipras visited Russia to take part in the St.
Petersburg International Investment Forum - Putin offered him financial help
(*4) initially related to the prospective Russian natural gas pipeline (going
through the Greece).
Knowing the aggressive expansionist tendencies of the
Russian President, already well visible in the case of the Ukraine, and
Transnistria, such an offer is not without the strings attached.
Right after the WWII, Russia sponsored a socialist
revolution in Greece (*5) when the royalist government was restored by
plebiscite in 1946. It took 3
years, then, to remove the communist threat with help of the West.
Now the West (mainly the European Union) should think very
carefully how to proceed in this matter.
One thing is to loose some of the money, Greece owns to the
European Countries, and other foreign banks - and completely another, is to
have the Russia control Greece and this part of Mediterranean.
Greece is still a member of NATO, and if it is too
Russian-friendly, it would be devastating for the future of the North Atlantic
Treaty Organization, and it’s policies.
So, what’s gonna be…?
__________________________________________
*1 -
http://www.indiana.edu/~eucenter/documents/Euro-and-Greece-Explained.pdf
*2 -
http://www.pewresearch.org/fact-tank/2015/07/07/5-facts-about-greece-and-the-eu/
*3 -
http://www.nytimes.com/2015/07/06/world/europe/greek-referendum-debt-crisis-vote.html?_r=1
*4 -
http://www.usnews.com/news/business/articles/2015/06/19/greece-signs-deal-with-russia-to-build-gas-pipeline
*5 -
http://www.historytoday.com/richard-cavendish/greek-civil-war-ends
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