The Eurozone Crisis: Greece National Debt Essay examples

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The Eurozone Crisis - Causes and Solutions
The so called “Eurozone Crisis” began in 2009 when it became a publicly known that Greece national debt was over 113 % of their GDP. Consequently, Ireland, Portugal, Spain and Italy joined the club with their debt ratio exceeding 100 %. The investors concerned with the level of the sovereign debt, led to increased yield on the bonds of affected countries, which effectively caused the unsustainably deficits in those countries. Although European Union took certain preventive measures by setting up a rescue package, further political disagreements, lack proper planning and compliance with newly established rules, made the problem to grow and continue through 2009-2013. Needless to say, the
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Furthermore, I will demonstrate several possible solutions and preventive measures to those problems. According to my research, with properly applied austerity measures, improvements in productivity, and further monetary and fiscal integration, the Eurozone will be able to avert future financial crisis among their member states. The table above illustrates different interest rates that investors charged EU member states in between 1995 and 2011.
Historical Aspect of European Economic and Monetary Union (EMU)
The creation of the Eurozone was conceived in 1952 by establishing the European Coal and Steel Council (predecessor of the EU). The purpose of this coalition was to prevent wars between European countries through controlled access to the natural resources (steel and coal) (Gilbert 33). Further political and economic integration took place in 1958 with the treaty of Rome that established ECC (European Common Community) and EURATOM (Atomic energy Commission). The 1988 SMA (Single Market Act) implemented the single market and paved a road to the single monetary policy. It effectively established a common market, where goods and labor force could move freely across borders. Although EC (European Communities) was initially built around six countries (France, Germany, Italy, Luxemburg, Nederland and Belgium) it eventually expanded through several enlargements to 28 member countries. The Maastricht Treaty, 1992 provided blueprints for

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