In October 2011, one and a half years ago, I wrote a piece titled "Good news! Greece will grow again in 2014!" Here is the key passage of that piece:
Greece should return to growth in 2014, Mr. Reichenbach (Head of the EU Task Force in Greece) said. Perhaps that made some people feel good. Excuse me; feel good?
Another at least 2 years of economic decline? Put differently: another at least 24 months of a development which has already tested social peace quite noticeably every month? By the way, growth after 5 years of decline is not growth; it is only the beginning of getting back to where one already was before.
Now if that is not a final call that something needs to be done urgently to revive a dead economy, then I don’t know what is. Or does anyone really believe that social peace can survive another 24 months the experiences of the last 24 months?
Latest forecasts suggest that return to growth may indeed happen in 2014. These forecasts are announced with a degree of enthusiam. From today's perspective, such enthusiasm may seem justified.
Thinking back of the perspective of October 2011, it is quite incredible that Greece has come as far as it has without a major catastrophe. At that time, I could not envisage that social peace would survive such a prolonged period of depression.
Greeks have proved me wrong!