Saving Greece: A never ending story?

In 2014, there was evidence that Greece’s economic situation would take a turn for the better for the first time in a long while. A positive growth rate and a primary surplus of the Greek state budget seemed to signal that the reform and austerity policy would pay off. But last year’s political turmoil which led close to a sovereign default and a Grexit set back economic recovery and fiscal consolidation again — a zero growth and a small primary budget surplus are not sufficient to overcome the crisis. It is cold comfort that Greece’s economic situation could have been even worse: required growth rates at the 3 per cent level and the envisaged primary surplus of 3.5 per cent of GDP are still out of sight.