Region of Western Macedonia – Greece

Location: Southern Europe, bordering the Aegean Sea, Ionian Sea, and the Mediterranean Sea, between Albania and Turkey.

Total: 131,957 sq km

Land: 130,647 sq km

Water: 1,310 sq km

Natural resources: lignite, petroleum, iron ore, bauxite, lead, zinc, nickel, magnesite, marble, salt, hydropower potential

Land use:
agricultural land: 63.4%
arable land: 19.7% forest: 30.5%
other: 6.1%

In the years following the adherence to the single currency, the Hellenic Republic has experienced a remarkable and unparalleled economic growth within the Euro area. This decade of growth came to a halt in 2009, when the global economic recession hit the Greek economy heavily. Starting in 2008, there was a contraction in gross domestic product of around 25%. The main factor behind the recession is the reduction in demand induced by the austerity measures adopted to deal with the precarious situation of public accounts. Over the last few years, the disposable income of families has collapsed due to the rise in unemployment (which in recent years has fluctuated between 20 and 25%, while youth income has recorded peaks even higher than 50%), in cuts in wages, the reduction of pensions and the collapse of capital income. This picture affects consumption, which also collapsed in the reference period, while showing signs of recovery in recent years. Furthermore, the percentage of the population at risk of poverty and social exclusion exceeds 30%, while more than 20% is in conditions of severe material deprivation (against an Italian figure of around 11%), according to Elstat estimates. The proportions of the crisis were also accentuated by financial factors, given the difficulties of the banking sector (haircut on public debt securities, increase in bank bad debts, linked to real estate mortgages). The recapitalization of the main Greek credit institutions has therefore been repeatedly requested, most recently in the framework of the III Program of aid agreed with the Memorandum of August 2015. However, following the shock created by the imposition of capital controls, the Greek economy appears to be recovering, albeit moderately. The achievement of the agreement with creditors and the elections of September 20, 2015, with the consequent formation of a new government contributed positively, avoiding the specter of an exit from the Eurozone country. Over the past two years, the Greek economy has held back its fall and shown timid signs of recovery, with GDP returning to growth at annual rates above 1% (OECD data), and a positive price dynamic albeit weak, which contributed to a stabilization of aggregate demand. This expansion is mainly driven by exports, which have shown significant growth rates in recent years, a dynamic that can be attributed to the regained competitiveness margins, following the reduction in wages. Also the investments in the country have started to grow again after a sudden collapse in the years of the crisis. The forecasts of the main international institutions, such as the International Monetary Fund and the OECD, are also positive for the years to come.



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