Greece post-bailout surveillance regime to end
Greece ends its post-bailout enhanced EU surveillance regime following nearly a decade of economic difficulties.
The EU put Greece under enhanced surveillance to institute economic reforms after three bailouts from 2010-2018. Ending the surveillance will strengthen Greece’s international market position by increasing its attractiveness to investors. Athens will also now have greater control over its domestic economic policy.
Greece has struggled with economic difficulties brought on by a ballooning government deficit and a liquidity crisis following the 2008 financial crisis. This hurt the Eurozone and brought on numerous bailouts by the IMF and other EU members, resulting in the surveillance regime. Despite successfully instituting reforms, difficulties such as chronic tax evasion, a tourism-dependent economy, and a large bureaucracy may hamper long-term growth.
The end of the surveillance program is good news for Greece’s government and investment rating, it comes at a difficult time. Economic shocks like high inflation and the Russia-Ukraine war, mean wages and job growth are unlikely to increase short-term. GDP is predicted to grow 4% in 2022 and 2.4% in 2023, a positive sign for Athens. Long-term, it appears probable that Greece’s economy will stabilize and grow as banks can now finance new investments, as long as the reforms hold against continued weaknesses.
