Greece turned a page on eight years of spending cuts and three straight international bailouts on Monday as experts warned that the country’s economic challenges are far from over.
“The conclusion of the stability support programme marks an important moment for Greece and Europe,” said European Commission President Jean-Claude Juncker, hailing “a new chapter” in the country’s “storied history”.
The European Union, the European Central Bank and the International Monetary Fund loaned debt-wracked Greece a total of 289 billion euros ($330 billion) in three successive programmes in 2010, 2012 and 2015.
The economic reforms the creditors demanded in return brought the country to its knees, with a quarter of its gross domestic product (GDP) evaporating over eight years and unemployment soaring to more than 27 percent.
But Greece has now returned to growth, its once vast public deficit has been turned into a solid budget surplus—before interest payments are made—and the jobless rate has fallen below 20 percent, officials say.
“For the first time since early 2010 Greece can stand on its own feet,” added Mario Centeno, who heads the Eurogroup of eurozone finance ministers that monitored the bailout deals.
“This was possible thanks to the extraordinary effort of the Greek people, the good cooperation with the current Greek government and the support of European partners through loans and debt relief,” Centeno said.
“It took much longer than expected but I believe we are there,” he added. The Athens stock exchange’s general index was 1.0 percent higher in early afternoon trade.
The leftist-led government, at loggerheads with the creditors just three years ago, also hailed the move as a turning point.
“The economy, the society and the country as a whole are now entering a new phase,” government spokesman Dimitris Tzanakopoulos told Greek media Monday. He added that Prime Minister Alexis Tsipras would give a televised address on Tuesday.
Greek households, however, continue to feel the effects of unpopular and damaging austerity.
“Greece has many rivers to cross,” read Monday’s front page of the English edition of the Kathimerini newspaper.
It warned the country emerges from the bailout “with a shrunken economy and highly vulnerable to market turmoil”.
EU Economic Affairs Commissioner Pierre Moscovici also cautioned that “the reality on the ground remains difficult” but nonetheless praised the bailout exit as “historic”.
“Greece will be able to finance itself on (the financial) markets…, define its own economic policies all the while following the reforms of course,” he told French radio station France Inter Monday.—AFP