Fearing that the downward slide of Greece’s economy could create a domino effect throughout Europe and stall the economic recovery, the leaders of the 27-member European Union (EU), after meeting in Brussels on Thursday, pledged assistance to Greece.
However, since Greece’s plight has been impinging on the value of the euro, which it uses as its official currency, the assistance will be spearheaded by the 15 other member nations that also use the euro.
According to BBC News, Greece’s current deficit is 12.7 percent, more than four times the limit of 3 percent for EU members, and the country will have to borrow 53 billion euros (US$74 billion) just to stay afloat. The United Nations estimates the population of Greece to be 11.3 million.
In addition, unemployment was calculated at 10.6 percent for this past November, up from 7.8 from November 2008.
Greece “will not be left on its own, but there are rules and these rules must be adhered to,” said German Chancellor Angela Merkel regarding the E.U.’s ceiling on debt and other issues, according to the U.K.’s Guardian.
The details of the assistance plan for Greece are likely to be released on Monday. In the meanwhile, Greek Prime Minister George Papandreou has instituted austerity measures, such as freezing government salaries, replacing only one-in-five retiring civil servants, gradually raising the retirement age for state pensions from 61 to 63, and raising taxes on fuel, tobacco, alcohol, and property.
On Wednesday, government workers held a one-day strike. The strike included air traffic controllers, which shut all Greek airports for the day. Taxi drivers are currently striking to protest fuel tax increases.
However, since Greece’s plight has been impinging on the value of the euro, which it uses as its official currency, the assistance will be spearheaded by the 15 other member nations that also use the euro.
According to BBC News, Greece’s current deficit is 12.7 percent, more than four times the limit of 3 percent for EU members, and the country will have to borrow 53 billion euros (US$74 billion) just to stay afloat. The United Nations estimates the population of Greece to be 11.3 million.
In addition, unemployment was calculated at 10.6 percent for this past November, up from 7.8 from November 2008.
Greece “will not be left on its own, but there are rules and these rules must be adhered to,” said German Chancellor Angela Merkel regarding the E.U.’s ceiling on debt and other issues, according to the U.K.’s Guardian.
The details of the assistance plan for Greece are likely to be released on Monday. In the meanwhile, Greek Prime Minister George Papandreou has instituted austerity measures, such as freezing government salaries, replacing only one-in-five retiring civil servants, gradually raising the retirement age for state pensions from 61 to 63, and raising taxes on fuel, tobacco, alcohol, and property.
On Wednesday, government workers held a one-day strike. The strike included air traffic controllers, which shut all Greek airports for the day. Taxi drivers are currently striking to protest fuel tax increases.
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