Economy of Greece
Greece is one of the ancient sophisticated nations in the universe, and for several decades, one of the most flourishing and successful.
The nation of Greece is positioned in Southern Europe. Its position next to huge water bodies makes it major property for importing and exporting commodities to other nations. Being such a rich and densely inhabited state, Greece requires a government to lead the nation. Concerning its administration, Greece is presently a parliamentary democratic state. Though Greece, in its history, was one of the initial states to discover the principle of social equality, through philosophers like Socrates and Plato, the constitution that was meant to get rid of the Greece governance, then, was never formed until many years later. The existing administration has only been in control as of 1974 when the kingdom was eliminated by Greece’s modern referendum (Guisepi, 1998, p.
1). The Greek financial system basically relies on agriculture. 25% of the Greek labor force is involved in farming, and agriculture makes up approximately 15% of the GDP. 59% of workers are employed in agricultural service industries such as, construction, petroleum, tobacco and food processing industries. Little consideration has been directed to the farming segment of the financial system.
The ranches are quite undersized; the distribution of land inherited by people has condensed the normal magnitude to 8 acres. It is actually hard to employ mechanical tools proficiently. Harvests are also small owing to the aridness and wearing away of the top soil. Greece has a varied capitalistic financial system with a big public division that gives about 50% of GDP, an aspect that is partially responsible for the dawdling monetary increase. Some of the agricultural products from Greece are tobacco, barley, wine, dairy products, corn, among others (Guisepi, 1998, p.
1). The Greeks initiative of a financial system was similar to the current doctrine. The expression “economy” to the Greeks denoted things such as family rules. The Greeks never considered the financial system as a communal thing; but as an individual aspect where every man handled their own problems. The majority of the Greeks were experts in sailing; they fished and sold the fish in nearby markets. The Greeks attached so many sacred and idealistic notions to their food.
For instance, they thought it was immoral to slay and consume animals, unless it was meant to be a sacrificial gift to the deities. They also attached some religious beliefs to vegetables. The Greeks consumed primarily Mediterranean provisions such as wheat, wine and olive oil. Currently, the Greek culture continues to affect the globe through philosophy, art and science. Even though Greece is a farming nation, the agricultural input to the financial system is merely 15%.
The business which had the highest contribution to the Greece economy is the tourism and transport industry. Each year, Greece receives almost 20 million tourists, a number almost two times the country’s population. Because of its Mediterranean weather, Greece is sanctified with exceptional goods, which can only be obtained in an ultimate environment. Greece also has a significant marine business, which is the biggest in the universe (Guisepi, 1998, p.2). While the financial system of Greece had become better in current years as a result of the manufacturing growth and tourism, right now the nation faces a great and rigorous monetary catastrophe.
Since 2002, the country has been using the euro currency, which substituted drachma. The hosting of the 2004 Olympic Games, which cost double the initial estimate was a huge blow to the Greek financial system. Currently, Greece is one of the bankrupt nations of the European Union with the second-to-lowest regular revenue, following Portugal, but seizes the 22nd rank in the international collection. The restoration of the financial system and the decrease of joblessness, which is now at12% rate, are the main difficulties that Greece is facing. During the end of 2009, Greece had to experience considerable challenges of the relentless economic predicament such as the increased rate of joblessness, levy invasion and fraud of the political groups.
Consequently, in April 2010, the state obtained a huge loan from the WMF and the E.U. In substitute for this great rescue, the administration declared collective expenditure reduction and high levy in addition to the harsh austerity procedures previously executed. Greece is currently in arrears that intimidate the Euro zone, yet the nation exposed a grand arrangement to eradicate levy avoidance and increase proceeds in the subsequent decades in an effort to furthr reduce its financial plan scarcity and regain market assurance. With a steadily intensifying rate of joblessness, Greece should devote its finances to exports, trade formations and farming in order to stabilize (Countries of the World, 2011).
Greece is an associate of the European Union and one of the uppermost categorized when it comes to its tourism and community organization. The financial system of Greece had a quick expansion throughout the World War II and in the 1980s and subsequently yet again the two-year phase of 1995-1996. Nowadays, Greece is an industrialized state with an increased level of affluence. The recent depression has made the complexities of the Euro develop into a more prominent region- particularly for the marginal quarters of the Euro zone such as Italy, Ireland, Spain and Greece. The intensifying country debt to more than 100% of GDP is another problem facing Greece. Greece has a financial statement debit of 12% for this year.
With this concentration of arrears, many markets have begun questioning the probability of the Greece government evading payment. This apprehension has pushed many Greece investors into selling their shares and increasing the interest charges. Greek arrears are currently much more costly compared to German arrears (Countries of the World, 2011). Another problem facing Greece is the availability of an uncompetitive market. The Greek financial system is collegial since the increase in earnings has not corresponded by increasing efficiency. This shortage of competitiveness has brought a decrease in demand for Greek commodities and an extremely huge current account shortage, where the imports more than the exports.
Moreover, the country does not have the capacity to devalue. If the county had its individual currency, the values of its currency would reduce to facilitate the re-establishment of competitiveness. However, since they use the Euro, they are incapable reducing its value and reclaiming competitiveness. The GDP of Greece has undergone severe depression after reducing by 1.2% in 2010. This amplifies the financial plan shortage and causes higher rates of joblessness.
The plans that Greece has implemented to eradicate this depression might only intensify their problems. The country is being advised to deal with its economic deficit as soon as possible. This entails – increased duties, reductions in public division earnings and lesser government expenditure. However, since the economy is undergoing a collapse in its productivity, higher unemployment rates and especially the realistic risk of depression a deflationary economic strategy, lacking a harmonizing release of a financial strategy could make the situation unbearable. The financial plan shortage does require tackling, although, the financial system requires some financial incentive. Greek cultivators are by now complaining.
Some believe that the major Euro associates like Germany will assist extravagant Greek duty payers and unproductive regimes. The Greek financial system is in a genuine mess, and it is not only the increased administration debt that is the problem. Actually, answers to cut down the debt could bring a profound depression, which will further decrease duty proceeds. The budget deficit will have to be dealt with, while improving the economy in different approaches. Currently, Greece is being asked to execute all the difficult actions regardless of the pain (Countries of the World, 2011). The official institution of the contemporary system of economic assumption and the materialization of financial notions can be traced back to prehistoric Greece.
It is in the earliest Greek philosophy, where we discover the ideas of economic thinking and how that happened. This is where a form of a monetary philosophy started to emerge; prehistoric Greece is the origin of monetary philosophy and Economics. This philosophy facilitates the study of economics by offering a strong basis from the earliest Greek theorists. Ancient philosophers like Plato, Socrates, and Aristotle among others discovered and studied logic, virtues, morals, proof, science and synchronization. Aristotle was a Greek logician and polymath. He is significant not only for his assistance in theoretical opinions but also for the influence he had on monetary views in the era of scholasticism.
Aristotle’s tutor, Plato, had disputed that the best leaders in the society, the defense force and theorists, must not own personal assets, but instead should have joint possessions, to evade quarrels over possessions that might turn away their interest from more significant matters. Nevertheless, Aristotle thought that personal property provided a practical purpose in society and that no rules should be enforced to resstrict the quantity of assets in private ownership. His noticeable contradiction in accusing the search of monetary benefit while approving the right to personal possessions worried ethical theorists until the 16th century (Travel Document Systems, 2011). Aristotle’s major help to economic philosophy involved the exchange of merchandise and the utilization of currency in this exchange. Aristotle coincided with Plato and nearly all other Greek scholars on the need of studying economic movement in an extensive framework and not compartmentalizing analysis.
One of the fascinating remarks made by Aristotle is that the predicament of insufficiency can be dealt with by lessening expenditure, and by altering people’s way of thinking. This is a great proposal for the different Utopians and communists who expect to stop community arguments by eradicating the differences that are innate in insufficiency. The Hellenistic Age was a great decisive moment both in Greek and Roman financial history. It unlocked the trade system with the East, innovative farming practices were discovered and the increase of a comparatively homogeneous currency all through the neighboring East started. The financial system of the Hellenistic era remained tremendously agricultural (Travel Document Systems, 2011).
In realistic terms, the philosophical icons would think a lot concerning the economy. They existed prior to entrepreneurship, assistance finances (loans), accounting skills, and collective consumerism. They would establish a society fundamentally altered by learning, manufacturing and machinery. They might even be astonished by the fury, not consideration, which has absorbed Greeks, which has been hindered by continuous complaints and mutinies disputing salary reductions and strictness actions. The “social contract,” a suggestion with Greek ancestry that classifies people into a political party, was in “vicious rupture” since the nation protection grid was being reduced considerably. The administration argues that the salary reduction and levy hikes are essential to obtaining global salvage loans that are discouraging a broader European or even international catastrophe (Wallop, 2011, p.
1).Various philosophers affirm that Aristotle’s assumptions are some of the most appropriate to the economic turmoil that has denied numerous Greeks employment opportunities and country profits formerly assumed. That remark, that possessions should satisfy human requirements and not stimulate insatiability, will make sense to Greeks annoyed with political leaders for previously involving the state in debt, putting the nation in its current catastrophe. This can be viewed from a different perspective as anti-capitalist, because Aristotle’s thoughts are believed to have persuaded Karl Marx. Mark claims that philosophy is applicable to all human circumstances and is acutely political all together. In rough moments, individuals have to some extent an obligation to rediscover the fundamentals of ethics.
Philosophy is incapable of unraveling the quarrels in a contemporary country like Greece (Wallop, 2011, p.1). Thus, the fact that Greece has acquired huge loans, overspending its finances and charging small tax rates is worrying. These are automatic and practical matters that must be tackled, unquestionably. However, at its center, the predicament within the Euro zone is that it is based on an unsuccessful financial judgment which is essentially anti-egalitarian and against the determination of the European citizens.
The entire notion of Maastricht, if it was to be successful, was that all nations must deal with their financial affairs with the exclusive precedence of making certain that the European common market and legal tender take priority above all other subjects of concern. Based on the above information about the Greece economy, I believe that this is a state that is gradually beginning to establish itself and rebuilding some of the lost integrity throughout the huge impact in inflation and joblessness. Given a little time and tolerance, Greece will keep on growing financially and develop into rather a successful state. These figures literally portray a positive image of the daily livelihood in the country. This data is also fascinating when compared to the United States since the disparities are evident. GDP is data that informs us more about a nation’s economy.
One can notice how fine they are doing pertaining to revenue, expenditure, and consumption. The present GDP of Greece is at $189.7 billion, which translates to $17,900 per capita income for every citizen. Greece has several natural resources such as lignite, oil and bauxite (Wallop, 2011, p.2).