Greece is one of the European countries that have been struggling economically recently. The world financial crisis has shaken many countries, but Greece seems to be slow in recovering. Here are some of the things you should know about the economic condition of Greece.
They leave the eurozone
Greece has voted ‘no’ in the eurozone. This might have a number of consequences. Initially, Greece will suffer for a short time. The Greek government thinks that it is the best way to revive its depressed economy. Introducing new currency means that the export will increase due to the low price of goods and more tourists will be attracted due to cheap vacations. On the other hand, some experts think that Greece will be in a dangerous situation. The price of products will increase, imported medicine will become scarce. Many people may get into poverty. So, there is still uncertainty about the economic condition of the country after they have left out from the eurozone.
Banks are closing
Recently, the government of Greece has missed a payment to the International Monetary Fund. This has created the risk of many banks getting closed. They might even be forced to leave the monetary union for missing the critical payment.
The unemployment rate of Greece is much higher compared to the other European countries. This is affecting the GDP of the country. The government should encourage more investment opportunities so that job market can be created for the people of Greece.
Social security tax
The social security tax is high in Greece compared to the other countries. Also, the government finds it difficult to collect taxes from people every year. There must be reform in this sector in order to improve the economic condition of the country.
The banks are in huge debt now. They need to find ways to pay off the debt. More deposit must be collected and the money must be invested in profitable ventures. Once the banks become debt free, the economy of the country will become stronger.
Banks play a huge role in the development of the economy of a country. There must be reforms in the sector so that the banks can contribute positively to the economy of the country. The long-term impact of Greece leaving the eurozone is still unknown. The government is hopeful that it will bring some good results for the country. Once the unemployment rate decreases, more investments occur and the banks become debt free, the economy of the country will improve.