Greece versus RSA: We should stand proud!

The Greek Crisis makes my proudly South African blood run cold.

Lets summarise.

In May 2010, the EC, ECB and IMF came to the rescue granting Greece a €110 billion bailout loan.

In 2011 add another bailout worth €130 billion.

In 2012 the IMF pumped in another €8.2bn.

Now the haggle is over Greece wanting another €53 billion.

Knock off a few zeros and one cannot imagine even lending on this record.

That’s as near as damn €300 billion since the financial crisis. That’s close on R4 trillion for a county with a population of 7 million.

Over the same time South Africa has borrowed about R1,3 billion to support a population of 53 million. So, in short, Greece has borrowed 4 times as much as RSA to support a population nearly one-eighth of the size.

All this while RSA has a gini coefficient of 0,59 or more. The Greek gini coefficient is 0,34!

The minimum state pension is Euro 450pm. (R6 000 per month.) Maximum pensions are Euro 2538 per month (R33 000). Wait for it there’s more. Greeks get 14 pension payments per annum. And the minimum age for pension for women in Greece is 60. South African state pensioners get a lousy R1 330 per month.

But South Africa is trying to do something about its debt trajectory. In 2015 we have had a 1 percent personal tax increase and 80,5 cents a liter on fuel. We have also cut government expenditure by R23 billion.

The whole situation is disgraceful. It is easy to blame the whole situation on irresponsible Greek governance. But perhaps we should also be asking why the rest of the world waited for a third bailout before crying foul.

My bet is there will be another bailout, this time with stricter terms. But will it solve the problem? I don’t think so. Eventually they will have to bite the bullet. Either a major portion of the debt will have to be written off or Greece will have to exit the Euro.

Raising Greek corporate tax rates on companies or increasing VAT rates on consumers who are all broke will never contain the situation. Austerity cannot be the solution.

Back in RSA I think we can stand proud of our national treasury and their achievements in containing national debt. Not that we will get much recognition for it from the international community.


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