The Public Debt to GDP ratio in Greece

The ratio of public debt to GDP is amazing when it is decomposed.
GDP since 2009 was down by more than 20%. During this period the debt has not grown so much.
In other words, the profile of the ratio of Public Debt to GDP reflects mainly the drop of the economic activity. This is the consequence of the austerity policy that was imposed to Greece by the troika. (See here for the Greeks’ effort)
We can then understand that the debt relief discussion that will come after the agreement on yesterday’s proposals by Tsipras is just a counterpart of this persistent austerity.
070715krugman1-blog480Source Paul Krugman (see here)

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s