After the discussion about Greece’s current financial dilemma, I decided to further investigate this issue with regards to the effect it has in the global market. In the coming year, Greece’s gross domestic product is expected to fall from 8.5% to 6.8% in addition to the economy shrinking by a total of 7%.
Greek’s agreement of an estimated 8 billion loan with the International Monetary Fund (IMF) puts the nation’s finance minister, Mr. Venizelos under immense pressure. Mr. Venizelos is expected to present a draft of next year’s budget to the parliament on Monday.
Bearing pressure from troika, 2012’s budget cutbacks include eliminating 30,000 public sector jobs by December. This is projected to achieve a surplus of an estimated 3.2 billion before paying debt servicing costs. To ensure such tough measures will proceed, both Mr. Venizelos and the prime minister sent a letter guaranteeing personal commitment to meeting the timetable.
Riots and strikes are anticipated to continue, with protesters throwing rocks and petrol bombs at the police. Greece’s debt crisis has also raised investors’ fear resulting in significant downfall in the global stock market. In order to stabilize Greece’s economy, the country needs to improve its industry business so Greece could pay off its debts.
