EVERYONE IS WAITING for Greece and Europe’s leaders to agree on a bailout deal.
It seems as if every morning brings another incremental development or regression in Greece’s battle against its European creditors.
So in the meantime, here’s a guide to what’s been happening in the underbelly of Greece’s economy, including everything from demographics to corruption to olives.
Back in the fourth century BC, 13 Greek city-states borrowed from the Temple of Delos. Most of the borrowers, however, “never made good on the loans and the temple took an 80% loss on its principal”.
As a reference point, Plato, Aristotle, and Alexander the Great were alive during the fourth century.
Greece defaulted on its external-sovereign-debt obligations five times:
Greece finally gained independence from the Ottoman Empire in 1830 after Great Britain, France, and Russia intervened to help out in the War of Greek Independence. (Fun fact: even poet Lord Byron joined in to support Greece.)
The country has spent 90 out of 196 years since then in financial crisis.
A Brookings Institute study by Daniel Kaufmann estimated that corruption cost Greece about 8% of gross domestic product per year (some have estimated it as high as 10%). Notably, a large bulk of it involves ordinary citizens doing day-to-day activities.
“If Greece had better control of corruption — not to Swedish standards, but even at Spain’s level — it would have had a smaller budget deficit by 4% of gross domestic product” on average over the past five years, Kaufmann wrote back in 2010.
A 2014 study by the European Commission said Greece was the most corrupt country in the European Union — on par with China.
Upper-middle-class professionals in Greece dodge taxes.
A blurb from a University of Chicago paper from 2012 says “the self-employed are paying over 100% of their reported income flows to debt servicing on consumer loans”. Analysts have suggested that this means they are underreporting their incomes.
In 2009, €28 billion of tax was evaded by self-employed people alone.
Last year, youth unemployment was recorded at 56.4%.
Overall, Greece’s unemployment rate remained steady at 25.6% for March 2015. It hit an all-time high of 28% back in September 2013.
And over half of those between the ages of 25 and 34 live at home. These numbers have gone up since 2010.
“Moving out of the house you grew up in is a rite of passage,” Bloomberg reporters Flavia Krause-Jackson and Giovanni Salzano write. “Moving back in with your parents is a cry for help. In Greece, it’s come to just that.”
Greece has an aging population: Only 9.8% of Greeks are ages 15 to 24, while 32.9% are over the age of 55. The birth rate has fallen to 1.3 babies per woman.
This is a twofold problem as rising pension costs will have to be paid for by a labor force that’s shrinking.
Greece’s gross domestic product is $242.2 billion, while Massachusetts’ is $420.75 billion.
Massachusetts is 10,554 mi2 (27,336 km2), while Greece is 50,949 mi2 (131,957 km2).
This chart from RBS Economics shows the trajectory of gross domestic product indexed to just before things got bad in the US during the 1920s and in Greece just a few years ago.
Greece, the third-largest olive-oil player in the world after Spain and Italy, produces 300,000 tonnes a year. Ninety percent of that is exported to the European Union.
Fun fact: Some of the olive trees planted in Greece during the 13th century are still producing olives.
An adult blue whale weighs 420,000 pounds.
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