The former prime minister of Greece referred to the restoration of democracy, the accession to the EEC and also to the EMU as milestones in Greek history and the Greek economy Loukas Papademos during the discussion he had with Kostas Kostis, Professor of Economic and Social History of the EKPA and Director of the Educational Foundation of the National Bank, in the context of the conference “RECONCILIZATION: 50 Years Later“, which is co-organized by “Kathimerini”, the Educational Foundation of the National Bank (MIET), the Economic Forum of Delphi and the Greek Observatory of the London School of Economics from February 29 to March 2 at the National Gallery.

“My assessment is that overall they had a positive effect on the Greek economy because they created the conditions for the country’s participation in European integration and set the stage for the integration into the economic and monetary core of Europe».

The great achievements of Constantinos Karamanlis strengthened both the economic and geopolitical position of the country, according to him, a position that will allow Greece to participate in the process of globalization and technological transformation that are underway.

Mr. Papademos also referred to the alternation of different economic phases in the 50 years since the fall of the dictatorship.

“There were periods of strong economic growth combined with price stability and improvement in social welfare, but also periods of weak growth, stagnation and recession which in some cases were combined with high inflation.” However, both for the past and for the future, the assessment of Greece’s entry into EMU is, according to him, positive. “Given the painful experience of the crisis, few remember that the EMU accession process and the period that immediately followed were characterized by strong economic growth and an increase in the standard of living of Greeks».

For 12 years the country has achieved high and continuous economic growth combined with stability, he pointed out.

In the reports for the years 2000 and 2001, before Greece joined the EMU, extensive proposals had been made for the need for substantial reforms in many areas in order to ensure fiscal stability and support strong and sustainable growth and social welfare, recalled Mr. Papademos.

“Many of these reforms were either not implemented, or only partially implementedi”.

He found, however, that in recent years progress has been made in implementing the necessary reforms.

In any case, the implementation of macroeconomic and structural policy in the period preceding the Greek crisis “was not compatible with the limitations set by the single monetary policythe”.

Immediately, but gradually, the fiscal policy was characterized by increasing deficits and an increase in debt, which could not be financed by the markets on reasonable terms, he explained.

At the same time, the international competitiveness of the economy was eroded.

Mr. Papademos expressed his belief that in the first phase of the financial crisis, debt restructuring was neither necessary nor advisable. However, since the end of spring 2011, fiscal developments and problems that emerged in the implementation of the policy changed the situation.

“The decision was not taken by me, nor by the coalition government. It was taken at the summit in October 2011 and, according to the decision of the Eurozone leaders, it had to be linked to a new economic adjustment programme. With a new memorandum which, in combination with the restructuring of the debt, would also be linked to the financial support of the country with 130 billion euros».

According to him, there was no alternative, as the restructuring was completely linked to the negotiation and agreement on the second memorandum.

“It was a condition for the support of Greece from the European partners“, he said, noting that the debt restructuring was the largest debt restructuring in history for any country.

Finally, when asked by Mr. Kostis about the performances we can expect from the Greek economy in the future, he pointed out that they do not depend only on the implementation of the appropriate economic policy and the implementation of the required reforms.

“They will depend on the progress made in completing and strengthening the European economic and monetary union, but also on policies to address the major challenges and crises of the times such as climate change, migration flows, geopolitical tensions, and conditions that have been shaped globally for the technological transformation of the economy».

In conclusion, as long as the appropriate macroeconomic policy is implemented and the necessary reforms are implemented to strengthen the competitiveness of the economy, the future will be much better with the country’s participation in European integration and in particular in the economic and monetary core, compared to not was a member.