- Dec 17, 2010
European Union Inavotingishika , Greece is expected to default and leave EU...
Greece's economy has struggled since the country joined the euro in 2001. Despite last year's 110 billion bail-out ($150 billion) and the introduction of harsh austerity measures, the country has been unable to balance its books.
Resistance to the austerity measures and a contracting economy have made it extremely difficult for Greece to clamber its way out of its financial problems, and it has been forced to negotiate a second package of assistance.
Greece is running out of options as pressure grows on its finances. Unless it can make good on massive debts it will default, with heavy consequences not only for the eurozone countries but for the global economy.
The ECB, IMF and eurozone countries have poured money into Greece to prevent default and may have to continue doing so unless another solution can be found.
This has led some to call for Greece to be allowed to quit or be thrown out of the euro, to ease the burden. Some Greeks also support this since they believe it would spare them from harsh austerity measures demanded as conditions for assistance.
Economists are divided. Many say it is impossible for Greece to drop out because the consequences would be so disastrous that eurozone economies will not allow this to happen.
However, the likelihood is increasing as Greece continues to struggle with its financial obligations. While there is no mechanism to leave the euro, Wheeldon says Greece is likely to be forced to leave or depart the currency of its own accord over the next few years.