What Ending Bailout Means For Greece

Aug 20, 2018
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DAVID GREENE, HOST:

Greece is formally exiting its bailout loan program today after eight years of austerity and financial reforms. The European Union and the International Monetary Fund financed this program after Greece's high sovereign debts threatened to force it out of the eurozone, the countries that use the euro as their currency. But while politicians in Brussels are celebrating the end of this bailout, many ordinary Greeks have very little to celebrate.

And let's get the latest from Joanna Kakissis, who has covered the debt crisis for many years and joins us from Athens. Hi, Joanna.

JOANNA KAKISSIS, BYLINE: Good morning, David.

GREENE: Well, so what does this actually mean? The end of the bailout that we covered so extensively and reported on - I mean, this sounds like a big deal.

KAKISSIS: Yeah. It sounds like a big deal, but nothing really is going to change that much over here. It means - what it technically means is that Greece will no longer have to please its lenders every few weeks with financial reforms and budget cuts in order to receive bailout loans so it can pay its bills. It's received about $331 billion from the EU and the IMF in the last eight years.

And in return for those loans, creditors have forced Greece to really cut its budget and raise taxes a lot so Greece can close this huge budget deficit that had risen to, like, 15 percent of gross domestic product. Now the state has this tiny budget surplus. But the damage to the country is extensive. The damage to the country's economy is extensive. So we likely won't see any more measures, but the EU says Greece will remain under intense scrutiny even after today.

GREENE: So how has all of that damage to the economy affected ordinary people in the country?

KAKISSIS: So, you know, the Greek economy has shrunk by a quarter. Unemployment has fallen to about 20 percent from a high of 25, 26 percent. But half of those looking for work, half of the Greeks looking for work have been unemployed for more than a year. If they get jobs, they're part-time jobs with no benefits or seasonal jobs. Their salaries have really fallen, so people really can't make ends meet.

Hundreds of thousands of young people have left the country, including the very best, the very brightest. We're talking engineers, doctors, scientists. The kids who did end up staying here, the young people who did end up staying here, you know, they're really lost. They're really struggling to find work. I know several, you know, young people who've joined the military just because it's a secure job and they know they'll get paid every month.

And then businesses, you know, which are, like, the lifeblood of the economy here - businesses are really struggling. They can't pay these huge taxes imposed by bailout lenders. And they struggle to get financing at banks, which are still fragile and don't give out new loans.

GREENE: Is there any hope now that after this step the economy will improve and people's lives will improve, or is Greece pretty much stuck in this pattern for the foreseeable future?

KAKISSIS: Well, you know, the economy is growing, but it's growing very, very slowly. So Greeks probably won't see anything happen in the next generation. It's going to be years before they see any progress, any hope. And so, like, Greeks have really downsized their sense of what's possible for themselves, for their kids, for their country. And so even though a European Union official recently said he's celebrating this occasion with an ouzo, the Greeks will definitely not be celebrating.

GREENE: Ouzo of course is a Greek liquor that if you're drinking it, hopefully it would be a reason to celebrate. But it sounds like, as you said, many Greeks will not be doing that today.

KAKISSIS: Absolutely not.

GREENE: Joanna Kakissis in Athens covering the formal end of the bailout loan program for Greece, but sounds like not much is going to change in the country anytime soon. Joanna, thanks.

KAKISSIS: You're welcome. Transcript provided by NPR, Copyright NPR.