Economic restructuring and the debt problem: the Greek case

Abstract

The Greek postwar economic development process clearly illustrates the links between the debt explosion, that many countries in the periphery and semi-periphery face at the moment, and the strategy of free-market economic restructuring. It is argued that both the balance of payments and the budget deficits, which fuelled the Greek debt explosion in the 1980s, have been heavily conditioned by structural problems that are directly related to the development strategy adopted by the Greek ruling élite. In the absence of radical structural changes, a new stop–go cyclical pattern tends to become a permanent feature of the development process: debt-led growth followed by Stabilization Programmes to secure the external debt servicing