The Greek economy
Greece is a
developed country, with a high standard of living and "very high"
Human Development Index,
ranking 25th in the world in 2007,
[12] and 22nd on
The Economist's 2005 worldwide quality-of-life index.
[5]
According to
Eurostat data, GDP per inhabitant in purchasing power standards (PPS) stood at 95 per cent of the EU average in 2008.
[13] Greece's main industries are
tourism,
shipping, industrial products, food and tobacco processing, textiles, chemicals, metal products, mining and petroleum. Greece's GDP growth has also, as an average, since the early 1990s been higher than the EU average. However, the Greek economy also faces significant problems, including rising
unemployment levels,
inefficient bureaucracy, tax evasion and corruption.
[14][15]
In 2009, Greece had the EU's second lowest
Index of Economic Freedom (after Poland), ranking 81st in the world.
[16] The country suffers from high levels of
political and economic corruption and low global competitiveness relative to its EU partners.
[17][18]
Although remaining above the euro area average, economic growth turned negative in 2009 for the first time since 1993.
[19][
verification needed] An indication of the trend of over-lending in recent years is the fact that the ratio of loans to savings exceeded 100% during the first half of the year.
[20]
By the end of 2009, as a result of a combination of international (financial crisis) and local (uncontrolled spending prior to the October 2009 national elections) factors, the Greek economy faced its most severe crisis after 1993,[
citation needed] with the second highest budget deficit (after Ireland) as well as the second highest debt (after Italy) to GDP ratio in the EU. The 2009 budget deficit stood at 13.6% of GDP. This, and rising debt levels (115% of GDP in 2009) led to rising borrowing costs, resulting in a severe economic crisis.
[21] Greece has been accused of trying to cover up the extent of its massive budget deficit in the wake of the global financial crisis.
[22] This resulted from the massive revision of the 2009 budget deficit forecast by the new Socialist government elected in October 2009, from "6-8%" (estimated by the previous government) to 12.7% (later revised to 13.6%). This revision (which, as claimed by members of the previous government, at least in part reflected the Socialists'
failure to control tax collection during their first months in office) has seriously undermined Greece's credibility leading to higher borrowing costs for Greece.
The Greek labor force totals 4.9 million, and on average work the second most hours per year amongst
OECD countries, after South Korea.
[23] The
Groningen Growth & Development Centre has published a poll revealing that between 1995 and 2005, Greece was the country whose workers worked the most hours/year among European nations; Greeks worked an average of 1,900 hours per year, followed by the Spanish (average of 1,800 hours/year).
[24]