The First Tranche of Aid to Greece – Assumptions and Effects

Abstract

Greece is one of the Eurozone countries that have been severely stricken
with public debt crisis since 2009. Without the financial help from the European
Union and the International Monetary Fund, Greece would not be able
to repay its debts to the creditors. The condition for providing aid to this
country was that Greece commits itself to a macroeconomic program aimed
at stabilizing public finance and regaining the capability of raising funding
resources on the financial markets on its own. The practice shows that as a
result of the implementation of the program the situation of Greece has not
improved at all but worsened. It turned out that it is necessary to restructure
the Greek public debt and this may lead to considerable losses for the
investors. The possible results of such restructuring for Greece as well as
the Eurozone and other European Union countries, including Poland, are
very difficult to predict. The first tranche of the bailout program for Greece
proved to be ineffective in solving the problem of its public debt.