Sunday, April 7, 2013

Current Events: Greece

Bomb Explodes in Athens. The bomb, which exploded underneath the Acropolis, was said to be carried out by an anarchist group in Greece. Fortunately, the police received an anonymous tip prior to the explosion and were able to clear the area of people and tourists. The bomb was said to target a shipowner in the area. This coincides with recent attacks on businesses, journalists, and politicians, who are seen as symbols of authority figures and larger business that led to the financial collapse in Greece. (March 27, 2013) 

Guerrilla group sentenced. Three leaders of a group known as the Revolutionary Struggle were given 50 year prison sentences. This group has claimed responsibility for firing a rocket propelled grenade at the American Embassy in 2007, as well as several other attacks on police in the years between 2003 and 2010. (April 4, 2013)

Financial Crisis in Cyprus (and Greece):
Cyprus becomes the fifth country to receive a bailout package from the European Commission, the European Central Bank, and the International Monetary Fund (collectively referred to as the troika). In exchange for the €10 billion deal, Cyprus will have to close one of its banks, where account holders (many of whom are Russian) will lose a given percentage of their investments to pay back the country’s debt. This has started a new wave of protests against larger European countries, and is strangely similar to the Greek Financial Crisis that began in 2008. More significantly, however, is that one of the main reasons for this crisis can be traced back to how the bailout deal for Greece was managed in 2011. In a decision made by troika officials, Greek government bonds were written down in value by almost 75% to pay back Greece’s debt. However, many of these bonds were held by the banks of Cyprus, which then obviously lost much of the money they thought they had. While this was not the only reason for the current situation in Cyprus, it shows the ripple effect that the conditions in Greece have had on other parts of the world. Currently, in Greece, there is debate over when Greece will receive the next portion of the approved bailout fund (€2.8 billion that was due in March). Although Greece has been praised for significant progress and improvement, the EU and IMF are encouraging even stricter austerity measures to ensure they can continue to meet future targets. Inspectors arrived in Athens this week to begin assessment and negotiations.

Lastly, this new crisis, which mainly affects the southern, Greek controlled area of Cyprus, could be the start of another attempt to reunify the area. Contrarily, the economy of the Turkish controlled area in Northern Cyprus has been growing with respect to Turkey’s economy. A vote for reunification failed in 2004. Although entirely speculative, this situation along with the improving relations between Greece and Turkey encourages the possibility of reunification according to United Nations representative for Cyprus. 

Source: New York Times

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