Troika’s Economic Adjustment Programmes for Greece: Why Do They Systematically Fail?

Abstract

The current Greek crisis—together with crises of the other euro-periphery economies—is at the epicentre of European Union’s (EU) structural problems. In order to overcome this crisis, the EU in agreement with successive Greek governments has applied three Economic Adjustment Programmes (EAPs), entailing successive loans to Greece in order to avoid default and linked to conditionality delineating the recipient’s obligations. These Programmes, despite their successive reviews and modifications, failed dismally to overcome the Greek crisis and achieve their own milestones. This chapter explores the causes of this blatant failure. The first part presents the historical timeline of the Greek EAPs and pinpoints their failures. The next part analyses the origins of these programmes and the peculiarities of the Greek EAPs. The last part explains the political and economic reasons of the systematic failures.