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An Evaluation of Policies for Fiscal and External Sustainability during the Recent Greek Economic Crisis

Chronis, Panagiotis and Zombanakis, George A. (2016): An Evaluation of Policies for Fiscal and External Sustainability during the Recent Greek Economic Crisis. Published in: European Research Studies , Vol. XIX, No. 1 (30 January 2016): pp. 30-47.

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Abstract

The scope of this note is to point out that high growth rates must be accompanied by current account surpluses financing the internal debt service as a necessary and sufficient condition for a debt-reduction strategy. The recipe is applied in the case of Greece which, looking back at the pre-crisis period, has been experiencing substantial consumption-led growth following extensive foreign borrowing.

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