After a few very painful and difficult months for Europe, it seems as though Greece is getting closer to organizing a bailout deal with its European creditors. The country's ministers will need to agree to details that are outlines in a new aid program before the 20th August, at which point funds worth 3.2 billion Euros will be released to Greece from the European Central Bank.
The financial crisis in Greece has caused a drastic reduction in the number of people visiting on holiday and on business, despite the situation having minimal effects on travelers' experiences in the country. Foreign cash and credit withdrawals have been unaffected by sporadic bank closings and the social climate has settled down to peaceful protests and demonstrations. Nonetheless, the perception of instability and stigma of being a country in 'crisis' has lead to dramatically decreased numbers of tourists, which has caused the Greek economy to further slide into decline. The prognosis now, however, seems more hopeful than before, and it seems as though essential agreements on both sides will soon be made.
What will happen if Greece exits the Euro?
Most Europeans are concerned with the state of Greece's economy because of the potential backlash that it could have on the Eurozone's economy and the strength of the Euro. If Greece refused to pay back its debt, or simply could not do so, experts argued that the shockwaves would be felt throughout Europe. Perhaps more pressing are the issues surrounding the global financial system. Since Greece's financial crisis started a few years ago in 2010, other foreign investors and international banks have sold a lot of their Greek holdings and bonds in order to ensure the safety of their own bonds. The tension between the European Central Bank and other foreign banks was at an all time high.
The impact of the financial crisis on smaller countries
The devastation of Greece's financial crisis has certainly been felt in and around Greece, however, it is not just Greece that is suffering. Other, smaller and poorer countries in the Eurozone are feeling the effects of Greece's financial crisis. Kosovo, Serbia, Albania, Bulgaria and Macedonia have already felt some of the shock waves before and after the banks were closed in Greece just a few weeks ago. Many migrants who had previously moved to Greece are now leaving the country and trade routes to Greece from these countries have been stopped almost completely since the country has no money to buy goods or services from anywhere else in the world.
Will Greece leave the EU?
While previously it was considered highly likely that Greece would bail out of the Euro in order to try and fix its financial issues, now it is seeming less and less likely that they will do so. It appears that, with the introduction of this new bailout plan of 3.2 billion Euros, Greece will be able to stay in the Euro and start making essential changes in order to build up its economy once again. If Greece had decided to leave the Euro, the decision would have had countless consequences, not only for the stronger countries such as France and Germany, but also for the weaker and poorer countries in the Eurozone.