Greece & The European Union

Whilst Greece currently struggles to put together the required sum to pay the interest on loans to the International Monetary Fund (IMF),  the European Central Bank and number of other lenders, (some of whom private lenders) decide what to do about continuing its membership of  The European Union. For the purpose of this blog, I thought it would be a worthwhile exercise to briefly look at history and go back to how Greece became a member of the European Union. I will summarize with an idea on how Greece can (arguably) move past the debt they are currently in.


Geographically Greece is a gateway to the Balkans and Russia. From the Russian perspective it is a gateway to Turkey and the Middle East. Let us go back almost two centuries to 1830 when the Ottoman Empire started to lose its grip on the Balkan in countries such Serbia, Croatia, Kosovo,
Montenegro, and Bulgaria.

Russia moved to fill the gap and expand its influence. However, Russian expansion to the Mediterranean through Greece was a sort of anathema for both Britain and France who were in the midst of the industrial revolution. Each country was vying for control of the sea with Napoleon and Nelson testing their flotilla and canons in the Mediterranean. It was a period of some 25 years before the opening of Suez Canal and the Mediterranean was simply the exclusive domain for Britain’s access to India.


When Russia moved to fill the Ottoman gap in the Balkans Britain and France, plus Austro Hungarian Empire rang their alarm bells. Greece was willing to ‘talk’ to Russia and that created what is referred to as the ‘Eastern Crisis’. Sultan Mehmet II in Istanbul was willing to do a deal to avoid Russian incursion and made alliance with France and Britain. The Sultan received support from Austro Hungarian Empire. The Crisis was averted but the tension remained. Whilst the Ottoman Empire is no longer in existence, the strategic importance of Greece and the Middle East in the 21st is  now even more greater than it was in the 19th century.

As a country Greece is full of ancient culture. Olympia is the site of the first Olympic Games which Greece last hosted this century for the 2004 Olympic Games. In the last half of twentieth and twenty first century, the Greek economy was always dependent on tourism and agriculture for its viability. Whilst number of major companies and multinational conglomerates moved or opened offices in Athens, Greece was no hub for economic growth. It lacked a boom in the industries like food manufacturing, agriculture, technology, equipment and machinery. This fact was well known to the major EU players the likes of Germany, and France. So one asks 'Is Greece important to the EU?'
I would say 'Yes'.


Whilst the players have changed; its neighboring country Turkey is the last remnant of the Ottoman Empire. It is for this reason, amongst others, the Mediterranean is still free from Russian navy and submarines. Now Vladimir Putin is ruling the White Bear and likely to be in the helm for some years to come, this ensures safety.On a side note, Russia is an exclusively Orthodox country likewise most of the Balkans and Greece.

The new Syriza government in Greece promised to take tough stand with EU about payment of interest on loan. This is to prevent default that could become a domino effect for other countries like Portugal, Ireland, and Spain. This feared Greek default is on interest payment only NOT on
interest and principle repayment to the IMF, World Bank and European Central Bank.

Some weeks ago in early April 2015, during IMF/World Bank spring meeting, the President of IMF/World Bank, Christine Lagarde, told the Greek Finance Minister, Yanis Varoufakis (former Economics Professor University of Sydney) that he needed to accelerate reform and that patience was running thin with the new Syriza government. Ms Lagarde wasted no time reminding Yanis Varoufakis that the European made huge commitments to supporting the Greek people and the Greek economy. In recent weeks the German finance minister had been most vocal especially when Yanis Varoufakis said that Germany still owed Greece substantial sums in reparations that date back to the damage it caused Greece during the Second World War.

Christine Lagarde- French Lawyer and Managing Director of the International Monetary Fund since July 2011.

So what are the real options to make Greece economically viable? In my opinion, and am sure others, the first option is for the International Body responsible for the Olympic Games to meet, vote, and approve a motion granting Greece the exclusive rights to host all, if not all, the next 25 Olympic Games in Olympia. Far fetched? I would say No. Ideally, I would suggest for the next one hundred years Greece has the exclusive right to hosting the Olympic Games. That will certainly give Greece much needed economic lifeline. After all, the Olympic Games is the exclusive domain of Greece. If not legally, certainly morally and historically. If this fails then the next obvious option is for the Greek Prime Minister, Alexis Tsipras, to become close to Vladimir Putin Russia and try to ignite the long forgotten ‘Eastern Crisis’. If that were to happen in 2015, I will be very much interested in the dialogue between Christine Lagarde when she meets Yanis Varoufakis.


As always, I'd like to hear your thoughts-feel free to comment and share your own opinion on this topic.