Official Eurostat figures show complete failure of Memorandum in Greece five years after it was imposed by the Troika and by Greece’s creditors
| 24 April 2015 |
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| Question for written answer to the Commission Rule 130 Notis Marias (ECR) |
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While the Troika is continuing to insist on adherence to Memorandum policies at the Paris negotiations with the Greek Government, Eurostat official data published two days ago show that, five years after its imposition by Greece’s creditors, the Memorandum has proved a total failure.
According to Eurostat, Greek public debt stood at 177.1% of GDP in 2014, up from 175% in 2013 and 124% in 2010, when Greece first adhered to the Memorandum.
At the same time, average debt in the euro area and EU amounted to 91.9% and 86.8% of GDP respectively.
In addition, GDP in Greece fell to EUR 179.081 billion in 2014, down from EUR 182.438 billion in 2013, while public expenditure as a percentage of GDP fell from 60.1% in 2013 to 49.3% in 2014 and government revenue fell from 47.8% to 45.8%.
Finally, according to the OECD, Greek workers are in third place among the hardest working people in the world.
In view of this:
Will the Commission, as a member of the Troika, continue to insist on adherence to its failed Memorandum policies of austerity, harsh fiscal adjustment, pension and supplementary pension cuts, VAT hikes, the destabilisation of labour relations and the sale of public property for next to nothing?
Source: European Parliament
| Answer given by Mr Moscovici on behalf of the Commission | |
| In 2009, with a deficit of 15.8% of GDP, very high public debt and other macroeconomic imbalances, Greece lost market access and risked to default on its obligations. In 2010, Greece asked for financial assistance to euro area Member States and the IMF(1), which was provided conditional on the implementation of structural reforms and budgetary measures needed to regain financial stability, restore the sustainability of public finances, regain competitiveness and return to growth and job creation. The EU has also provided support through its Structural Funds which were the key source of investment during the crisis.
In the absence of such financial support, the adjustment in Greece would have been much more abrupt with all its devastating social and economic consequences. Greece came back to primary budget surplus already in 2013, and experienced an economic rebound in 2014, with real GDP growth of 0.8%. Private consumption grew for the first time after five years of contraction. Investment rebounded for the first time since 2007. Employment recorded a positive rate for the first time since 2008. On 19 August 2015, the Commission, acting on behalf of the ESM(2), signed a new Memorandum of Understanding (MoU) with Greece. It provides for further stability support of up to EUR 86 billion over three years (2015-2018). There is great emphasis on reforms to create sustainable jobs, increase the effectiveness of social safety nets, widen the scope of unemployment benefits and of the access to health services. A new minimum income scheme will provide an effective safety net. Full implementation of a universal and cost-effective healthcare system is also a key objective of the programme. |
Source: European Parliament
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