Greece after the default: will it be possible to create economic growth and jobs?

GreeceGreece is currently on the brink of default. Few people believe otherwise. But what will happen next?

The structural weaknesses of the Greek economy are so huge that it’s hard to imagine better times, even without a mountain of debt to service – and without the burden of a strong currency (the Euro).

Greece will need very high levels of investment to boom their exports and to get more jobs, but will it be possible?

How to boost investments and create jobs? The current global unemployment rate is about 27%, while the youth unemployment is approximately 50%.

LEAVING THE EURO

After the default, Greece will have to leave the Eurozone, which may help the tourism-related activities.

Tourism provides 18% of the GDP, and jobs may increase significantly in this sector. But it will not be enough.

Hence the question: What about the other sectors?

GREECE HAS VERY FEW CARDS TO PLAY

Greece’s largest services export – shipping – has very few real links with the rest of the Greek economy. Shipping companies pay no taxes and employ few Greeks (the crews come from other low-wage countries).

And Greece hasn’t any significant manufacturing sector either; manufacturing hasn’t any visible impact in Greece’s overall exports, and it will not be possible to reverse decades-old problems in the short or medium time frame.

Greece hasn’t any region or city – and companies – able to function as an engine of growth and employment, and it is highly improbable any significant increase of the foreign investment, whatever the economic policies and the government.

With all the social and political turmoil in the horizon, what will happen to Greece in the years following the default? Will Greece be able to attract and create investment and jobs?

It’s highly doubtful.

The most probable and almost inevitable scenario for the next few years is violence, instability and a huge emigration of Greeks to other Europeans countries to escape famine and disaster back home.

More information: Greek Crisis

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