EU on brink: Top economist warns ‘money is GONE’ after huge Greek bailout | World | News

Official costs to the economic bloc of rescuing Greece following the 2008 financial crisis is €278billion. However, George Vamvoukas, who has served as Special Secretary of the Ministry of National Economy, said: “The EU has spent a total of more than €600billion.”

€80billion is said to have come from Germany alone, but Prof Vamvoukas, an economist at the University of Athens, told the Bild newspaper that its share of the bailout was closer to €170billion.

He said the money that had been given to the country was “gone forever”, the paper said.

The higher figures were because the “honest calculation” also included funds to rescue Greek banks, he said, as well as the two “haircuts” – a reduction in the value of the debt owed by a troubled borrower.

Prof Vamvoukas commented: “You can’t simply leave them out of the calculation.”

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The UK’s Chancellor Rishi Sunak has said that the debt was so high the Government would seek to reduce borrowing to bring it down.

Prof Vamvoukas said that the bailout had bought his country time, but the Greek economy had not been significantly built since the economic crisis.

He said that in the period between 2008 and 2021, “real GDP fell by 28.8 percent, from €250billion to around €178billion euros at the end of this year.

He concluded that “it is obvious that the national debt is not sustainable under the conditions of a negative growth performance”.

In 2015, Greece’s then-finance minister Yanis Varoufakis said: “Your money has disappeared into a black hole.”

Prof Vamvoukas described Greece’s debt as “permanent”.

The EU’s wider debt to GDP ratio has also been exacerbated by the pandemic.

In the first quarter of 2021, it estimated that the ratio stood at 100.5 percent for the Euro area.

Compared with the first quarter of 2020, the EU’s debt to GDP rose from 79.2 percent to 92.9 percent.

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