“Greece is in an extremely good financial position. The measures implemented during the euro crisis were painful but attributed. From this Europe can draw a lesson“, Says the governor of the Central Bank: that solidarity works effectively.

“We managed“, Said in an interview with the NRC Dutch newspaper Yiannis Stournaras. “With blood, sweat, tears and with help from the eurozone, Greece managed‘

The European media refers to the journey of Mr Stournaras, who negotiated the Ministry of Finance the Greece’s accession to the eurozone in 2001.

“This integration has led to a large reduction in the country’s borrowing costs. In part, because of this, budgetary discipline was derailed and fiscal deficits increased. When it was revealed that Greece had concealed the amount of its fiscal deficit, the situation was reversed: its credit rating was sharply reduced, the costs of borrowing became prohibitively and Greece could no longer meet its current loan obligations. It was followed by years of uncertainty, but also anger for extensive austerity measures. Citizens were afraid that their economies would disappear. Large queues were formed in the banks. Lenders, such as the IMF and other eurozone countries, required harsh cuts and reforms. The period between 2009 and 2016 was named “The Crisis of the Euro”.

Stournaras strongly opposed the “Grexit” and in favor of liberalization of the economy, reforms and austerity measures, initially as president of a well -known Institute of Studies and then as Minister of Economics. Since 2014, as the governor of the Central Bank, it has been monitoring the country’s financial stability, ”the newspaper notes, adding: and today it is in a position of power, no longer in a defensive position. The Greek economy is growing higher than the European average. Huge public debt is declining rapidly. 2020 was still 209.4% of GDP, while in 2024 it was 157.3%. Credit rating agencies now consider that Greek government bonds are a safe investment.

The interview of Yiannis Stournaras:

Are you happy?

We are very happy. Do you remember that in 2012, and again in 2015, everyone believed that Greece would not succeed?

Greece today pays even fewer interest for long -term bonds than France. Who would have imagined it!

Better than France, yes, but it’s not just that. Increasing our GDP is also much higher than average in the eurozone. In the budgetary sector, Greece’s performance is impressive. We have a 3.5%budget surplus. Reforms perform. The countries of Europe where things are going well now are the countries of the South that have been forced to implement reforms in the past.
I am proud and I want other countries to see us and say: If Greece has managed to overcome these very big problems, then we can do everything in Europe. This is what the experience taught us. And I think that in the Eurozone, they have been learned.

What are these lessons?

For us in Greece, of course, the lesson is that we should never let the responsible fiscal policy, financial stability and reforms be lost. And that it yields fruit when you reduce bureaucracy and simplify the processes. The lesson for the eurozone is that flexibility and realism is needed. I am pleased with how we respond today to the awakening call that comes to us on the other side of the Atlantic.
What we need now in Europe now is investments. Investments in Europe from the financial crisis have also fallen much more dramatically than in the US. This development is visible throughout the period after the collapse of Lehman Brothers [το 2008]. And we now see it in the difference of productivity. This is exactly the gap for which the [πρώην πρόεδρος της Ευρωπαϊκής Κεντρικής Τράπεζας και πρώην πρωθυπουργός της Ιταλίας] Mario Draghi speaks in his report.

Stournaras welcomes Germany’s decision to relax the “debt brake”, which will allow the country to borrow more money to spend on defense and infrastructure investment. It is also full of praise for the plans recently announced by the European Commission on the integration of European capital markets, the completion of the banking union and proposals for common defense spending. These are steps that he thinks could have been done earlier, because it is very clear that they are necessary. “There is no need to modify the conditions,” he says. “There is no need to consent to it. Today we have to act in time. “

Politicians in the Netherlands are very hesitant towards the joint European debt issue for defense -spending funding.

This is wrong. Big mistake. We need to unite our strengths and take risks together. Because as Europe we are now more or less on our own. What unites us is more than what separates us. And I’m glad it seems we’ve finally understood it. It is important that the conservatives in Germany are the ones who have decided to abolish the debt brake. Times are changing.

How do you explain this difference in investment between Europe and the US after the financial crisis?

Mistakes were made to handle the “Greek crisis”. The lending countries insisted on cuts even in public investment. But excessive cuts have a negative “avalanche result”. They reduce the fiscal deficit, but at the same time lead to a stoppage of economic growth. And then tax revenue is lagging behind. So things get worse. Greece was severely injured by adaptation programs. But lessons were drawn. This is important. I will use a Marxist phrase: Greece was “the mummy of history”. Through the Greek crisis the European Stability Mechanism (ESM) was established [ένα μόνιμο ταμείο χρηματοδότησης έκτακτης ανάγκης]. This was necessary in Europe to recapitalize banks. We have financial stability in this. Also, without the experience of Greece, the recovery and durability mechanism would not have been created [το κοινό ευρωπαϊκό ταμείο για την αντιμετώπιση της πανδημικής κρίσης]. And that was also a very positive experience. For such purposes it is worth spending money. In Greece we make sure to take steps in the digital economy, in green energy. It is an investment in human capital. Europe currently has a surplus in its current account balance. In other words, we save more than we are investing. So there is money to increase investment in Europe. This is very positive. We don’t need money from abroad.

Does the debate on issuing common European debt marks the symbolic end of the Greek crisis?

They are all interconnected. We need this joint action. The recovery and durability mechanism was a success. To create it, Europe borrowed 800 billion euros. This amount is distributed according to the needs. And in the poorest countries investment has a potentially greater effect. It’s money that doesn’t go missing. We can take advantage of this experience. How can we boost the role of the euro? I am not happy with what is happening on the other side of the Atlantic, but we already see that the result is the euro boost. US policy creates an opportunity at the same time.

How should we deal with this issue together? In your opinion, do you need a European solution?

We have the solution in our hands. We only have to come to an agreement between us. This is not a negotiation between the north and the south, between the core and the region. It is not your death my life. We need benefits for everyone (win-win), not a zero-sum game. No country is more important than the other. We are all part of Europe and we are all useful. The fact that we do not have a common defense policy makes us weaker. But if the US retires, this will also be an opportunity to negotiate on our own terms. In the end we become stronger.

Currently European savings are mainly located in the United States, because there are investments there.

Actually. And one reason is that European countries that had the opportunity to spend did not benefit to invest here, which would be good for productivity and efficiency. As in Germany. This is now done, and it is very good. Now we need to ensure that yields for private investors are increasing, facing the fragmentation of Europe in terms of regulatory regulation, policy and supervision. Single capital market also means a federal supervision. As for the banks we have a single supervisory body.

Greece, based on purchasing power, is classified one of the last positions in Europe, between Bulgaria and Latvia. Isn’t that such success story in the end?

Incomes had declined dramatically during the crisis. They are now growing at a very slow pace. In terms of GDP per capita, we gradually converge on the level of comparable countries in Europe. We are no longer at the point where we were before the crisis. But the economy then was a bubble, it wasn’t real. Wages have become more competitive, but we still have a lot to do to improve structural competitiveness. See, for example, public infrastructure, justice, the education system, the fact that even people with high skills do not meet the needs of the labor market. Also, some sectors of the economy remain very closed to the newcomers.

This is an issue that you have repeatedly emphasized since the beginning of the crisis. How do you comment on the fact that very few things have changed in the administration of justice and the areas you mentioned?

This is another of the mistakes that have been made during the crisis. We have chosen during the crisis to first drastically reform the labor market – which is now one of the most flexible in Europe. The purchase of goods and services followed later. So we reduced wages, but we didn’t do the same with the prices of goods and services. And only after many years did we begin to face the power of a small group of businesses, the oligopolies. If we had intervened in both areas at the same time, the reduction of purchasing power would probably be less serious and the recession is less deep. The order in which reforms are applied is important.

How many years will it take for Greece to come back to pre -crisis levels?

We are more ambitious than that. We want in less than twenty years to reach the same level as the rest of Europe. We grow faster than the European average. That’s why I’m convinced that we will succeed.