GREEK FINANCIAL CRISIS 2
Impact of the Greek Financial Crisis on other European Countries
Regional factors played a significant role in pushing Greece into a debt crisis. The rules
that come with membership to the European Union (EU) made it impossible for Greece to enjoy
full control over its fiscal policy. Similarly, the Greek financial crisis has had a significant
impact on the rest of European. In addition to the financial burden placed on other EU nations,
the Greek financial crisis strained the ties between European Union member countries by
presenting notable problems to the shared principles that create solidarity for the union. Greece’s
financial problems also illuminated the problems that exist with the vision of full economic
integration in Europe.
On the surface, Greece’s case shows that in addition to sharing the benefits of commerce,
European integration also implies the assumption of shared risks and losses. Based on Samitas
and Tsakalos (2013), Greece represents only a small percentage (2%) of the EU economy.
However, the economic impact of Greece’s financial status on other countries of the EU cannot
be ignored. For example, since the year 2010, Greece has been the recipient of almost 230 billion
euros in the form of bailout funds (Ewing & Alderman, 2015). These resources were meant to
create room for economic recovery by paying international debts. Additionally, these bailout
funds are accompanied by stringent measures which create tension and uncertainty. In fact, over
the years there has been a discourse of a Grexit. Possibilities such as the withdrawal of Greece
from the EU then invoke thought on the possible burden to individual EU nations and institutions
of the EU. These considerations indicate that Greece’s status presents complex problems for
Europe.
Greece’s financial crisis paints a good picture of the shortcomings that come from EU
membership. Greece’s membership to the EU was one of the fundamental causes of its problems.
