A debtor can declare bankruptcy when he can’t repay his debt from a creditor. Likewise, a country can declare bankruptcy, and this kind of thing is called a default when bankruptcy occurs in countries. The Greek economy has gotten worse and worse after the 2008 financial crisis and hasn’t yet recovered. The Greek default was announced by EFSF(European Financial Stability Facility) on July 3rd.
  It was not true at first that the Greek economy has fallen into danger. The Greek GDP attained 3.6 billion dollars in 2008 due to steady growth of its economy on the basis of the tourist trade and the marine transport industry. However, the Greek economy performed poorly after the 2008 financial crisis, and its ratio of debt to GDP grew rapidly after 2009 as Greece ran a deficit to stimulate its economy. The situation was becoming worse, so the Greek government received a bailout of 110 billion Euros from the IMF and the EU on the condition of a contractionary policy. This was the  first bailout package.
  The Greek contractionary policy ended in failure, and the situation got worse, so the Eurozone decided to provide a second bailout package for Greece. However, many Greeks opposed it. The Wall Street Journal surveyed about it by telephone, and the survey showed that 58.9% of respondents opposed the second bailout package. The reasons were the conditions of the contractionary policy and damage from economic independence. Consequently, the Greek government decided to have a referendum on the acceptance of the second bailout package and its withdrawal from the Eurozone. Despite the Eurozone nations’ opposition, the Greek government pushed the vote strongly. The EU, which was angry about Greece’s behavior, strongly mentioned they will defer the bailout of 8 billion dollars, and then Greece gave up on the referendum and adopted the second bailout package.
  On August, 2012, Greece paid back 32 billion Euros of the debt and became a little more stable. However, the situation became complicated due to a change in the Greek political power to Syriza, which is the leftist party. Syriza rejected the financial reformation that the Eurozone suggested, and they held a referendum on that issue. On July 5th, Syriza might have gained a little more power because 61% of voters objected. However, Eurozone nations felt bad for this result. In the end, on July 13th, Greece decided to adopt a third bailout package on the condition that the financial reformation would be more severe than before. As a result, Greece has actually lost its economic independence.
  There were several reasons for the Greek economic crisis. Excessive tax evasion is a big reason. For example, in Greece, if people have their own swimming pool, they have to pay tax on it every year. However, only 324 people registered their own pool in Ekali, which is located in the richest town in Greece. A Greek public official found a total of 16,974 pools by counting them in a satellite picture from Google Earth.
  In addition, Greek corruption is very serious. Transparency International investigated that 9 billion Euros were used as bribes in 2009. On the average, one person gives a bribe of 1,500 Euros or 1.8 million won in one year.
  Can we be sure that the Greek situation won’t happen in Korea? Korea has a strong economic foundation with its semiconductor industry and its steel industry among others. Furthermore, Korea uses its own currency, so Korea can’t be compared with Greece. However, in the Corruption Perceptions Index by Transparency International, Korea received 55 points, which is lower than 69.2 of the OECD average. Korea also has to try to be an honest country by building upright and honest policies.

By Shin So-hyeon
sh36@cbnu.ac.kr.