Type of paper: Research Paper

Topic: Athens, Greece, Debt, Crisis, Greek, Extension, Politics, Finance

Pages: 1

Words: 275

Published: 2020/12/06

The German parliament has agreed to extend its financial aid to Greece with four months. Greece is under a debt crisis, and has come up with reforms aimed at eliminating the crisis. The decision made by the German MPs about the extension of the financial aid to Greece was based on parliamentary votes. A majority of the MPs voted for the extension while a few remained skeptical and voted against the extension. The public is also highly skeptical of this move. The Greek civilians carried out demonstrations against the current Greek government. They blamed the government for the current debt crisis the country is facing. The Greek activists clashed with the police as they demonstrated. The Greeks want their country to get out of the EU, and for the government to cancel further debts (BBC, 2015).
Greece submitted some reform proposals so as to negotiate a deal for the extension of its financial aid. Germany is a major economic power in EU, and its approval is considered very important. The Germans voted for the deal because they want to keep Europe united. Wolfgang Schaeuble, Germany’s Finance Minister, supported the deal saying that the move was not about adding more debt to Greece, but rather an extension of the time needed by Greece in settling its debts (BBC, 2015). Many people doubt Greece’s capability of total commitment to the reforms.
The debt crisis of Greece is blamed on its government which was eager to borrow so that Greece could become a prosperous nation (NCPA, 2013). Constant borrowings led to the accumulation of big debts and a fall in the competitive level of the country. Lack of competition led to the decline of Greece’s growth potential. New Democracy and Pasok were the two political parties that led Greece, and they failed to make reforms in the year 2008 when the financial crisis hit the world. The private lenders to Greece were happy to lend because they would gather high interest. The lenders and creditors of Greece delayed in revealing the truth about the insolvency level that Greece had reached. They delayed the process so that they could take away their money before it reached a point of sharing the burden. The joining of the euro-zone created more room for Greece to continue cumulating its debts. In addition, the International Monetary Fund (IMF) succumbed to political pressures, and failed to act as a catalyst of policies and finances.
The implications of the Greek debt crisis include the future loss of jobs, low standards of living, and lack of savings. There is a high risk that the negative impacts of the Greece debt crisis will spread to the European countries as well as the world. The Greek debt crisis can only act as a lesson to other economies. Accumulation of debts leads to the creation of artificial booms that prevents people from seeing the danger that is posed to their economy. It is not bad to borrow, but there are policies and indicators that guide an economy so as to determine the limits of the debts. These limits should not be crossed so as to prevent debt crises.
The Greek debt crisis relates to this course because it enables the students to have a clear understanding of the dangers of excessive borrowing to the economy. The students are the future leaders, and it is important for them to know how to handle financial decisions. Debt can enable an economy to rise, but limits should be set so as to prevent excessive borrowing. A country should be able to meet service its debts.

References

BBC, (2015, Feb 27). Greek Debt Crisis: German MPs Back Bailout Extension. British Broadcasting Corporation. Retrieved from: http://www.bbc.com/news/world-europe-31654898
NCPA, (2013, Oct 2). The Causes of Greece’s Debt Crisis. National Centre for Policy Analysis. Retrieved from: http://www.ncpa.org/sub/dpd/index.php?Article_ID=23658

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WePapers. (2020, December, 06) Good Research Paper On News Story. Retrieved April 14, 2021, from https://www.wepapers.com/samples/good-research-paper-on-news-story/
"Good Research Paper On News Story." WePapers, 06 Dec. 2020, https://www.wepapers.com/samples/good-research-paper-on-news-story/. Accessed 14 April 2021.
WePapers. 2020. Good Research Paper On News Story., viewed April 14 2021, <https://www.wepapers.com/samples/good-research-paper-on-news-story/>
WePapers. Good Research Paper On News Story. [Internet]. December 2020. [Accessed April 14, 2021]. Available from: https://www.wepapers.com/samples/good-research-paper-on-news-story/
"Good Research Paper On News Story." WePapers, Dec 06, 2020. Accessed April 14, 2021. https://www.wepapers.com/samples/good-research-paper-on-news-story/
WePapers. 2020. "Good Research Paper On News Story." Free Essay Examples - WePapers.com. Retrieved April 14, 2021. (https://www.wepapers.com/samples/good-research-paper-on-news-story/).
"Good Research Paper On News Story," Free Essay Examples - WePapers.com, 06-Dec-2020. [Online]. Available: https://www.wepapers.com/samples/good-research-paper-on-news-story/. [Accessed: 14-Apr-2021].
Good Research Paper On News Story. Free Essay Examples - WePapers.com. https://www.wepapers.com/samples/good-research-paper-on-news-story/. Published Dec 06, 2020. Accessed April 14, 2021.
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