Greece finally emerged out of its final bailout programme helping it to re-enter the financial markets to raise own funds for the first time in eight years.
“Greece is now in a position where it can enjoy the full extent of euro area membership, abiding by the same rules as every other euro country,” Eurogroup President Mario Centeno said.
However, Greece’s troubles are not yet over as it is emerging from the bailout with Eurozone’s highest debt burden, which was about 180 percent of GDP, as of 2017.
The focus now will be to reduce the huge debt that is forecast to reduce drastically over the coming years.
The country, which was sunk deep in economic crisis, received three bailouts since 2010. Economic troubles led to a severe political crisis within Greece and the euro area.
Talks between the government and its international lenders for repeated bailouts were often dramatic and triggered speculation that the country may leave the single currency union, a scenario then dubbed “Grexit”.
Now, after a successful exit from bailouts, Greece will enter into post-programme monitoring.
During the final 3-year programme, which started in August 2015, the permanent fund, the European Stability Mechanism, provided EUR 61.9 billion to Greece for macroeconomic adjustment and bank recapitalization.
Through these years, Greece implemented stringent financial and tax reforms among other measures demanded by lenders and the nation was subjected to both political and economic turbulence during bailout talks with lenders.
Nonetheless, Athens eliminated its high fiscal deficit and the economy finally returned to growth from recession in 2013.
Athens had a huge government deficit of above 15 percent of GDP in 2009, which turned to a surplus in 2017. Still, Greece faces high unemployment and poverty rates.
“As the ESM and EFSF [ European Financial Stability Facility] are Greece’s largest creditors, holding 55 percent of total Greek government debt, our interests are aligned with those of Greece,” ESM Managing Director Klaus Regling said.
“We want Greece to be another success story, to be prosperous and a country trusted by investors,” Regling added.
Greece had received EUR 52.9 billion through bilateral loans from EU member states during the first bailout programme that ended in March 2012, and EUR 141.8 billion in loans from the EFSF between 2012 and 2015.
In addition, the International Monetary Fund disbursed a total loan volume of EUR 32.1 billion to Greece in parallel to the Greek Loan Facility and the EFSF programme of which around EUR 21 billion has already been repaid.