Posted by on 6 Jul 2012. Filed under Foreign Affairs, Top news. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Slovakia’s Groaning over Paying for Greece

The recent statement of Slovakia’s Prime Minister Robert Fico that his country “is losing patience” paying overdebted Eurozone member-states is something that stirs up pondering. It is not only Slovakia that questions bail-out plans and its contribution to the European Financial Stability Facility (EFSF), but a number of medium-size or small-size countries that retrieve commitments to rescue Eurozone from complete dismantling.

Greek s battling against the odds (c) Tibor Macak, The Daily.sk

It is without doubt that the financial contribution of Eurozone member-states to EFSF is additionally charged with ad hoc contributions for the ongoing rescue plans. Therefore states are overcoming their annual contributing capacity in the sake of overdebted countries and this inavoidably generates discontent, both in political and social level. In this respect, there are some facts that harden financial capacity of small and medium size contributing members ceteris paribus:

1. Like Slovakia, there are other member-states (e.g. Slovenia, Cyprus) that while having lower per capita income comparing to overdebted countries like Greece, they are abided by their commitments to make additional spending cuts to serve the EFSF. From a merely economic perspective, this sacrifying contribution could potentially lead to a lowering of state revenue income rate, and thus to an impediment of higher state income, as a significant part of fiscal income goes to EFSF instead of state’s account.

2. Overdebted medium-size states like Greece, while receiving and requiring rescue plans, continue to contribute to EFSF. Inevitably this give-and-take creates a paradox as a part of what Greece is receiving goes back to the fund of EFSF whereas the country is in desperate need of even the smaller part of its rescue package.

3. Groaning of small-size states is in large part understood as their political leadership are afraid that their countries could follow the same path of resorting to similar rescue plans in the near future. As instability in Eurozone augments, fear of downturn is equally increasing.

All and all, Eurozone crisis unveils a number of issues that necessitate immediate attention and revision. The badly-shaped mechanisms and regulations upon which Eurozone was built are now re-emerging the most critical concern that skeptic pundits were pointing out before and during the period of Eurozone’s formation: that of deep and wide divergence of Eurozone markets that have irrelavant structural deficiencies and different levels of growth capacity.

By courtesy of Euroactiv/BlogActiv

Author: Dimitris Rapidis

9 Comments for “Slovakia’s Groaning over Paying for Greece”

  1. Dave Crawford

    Where on earth do Greek students get the money from that enables them to live, alone, in appartments in the BA districts related to in Dimos’s comments, not to mention the funds that allow them to enjoy their “cafe lifestyle”?
    Let me guess, Greek students receive substantial grants for their education abroad from the Greek government, and where do they get this money from? – the EU tax payer. I don’t doubt that the students spend considerable amounts of money within the community but suggesting that this is some form of ecconomic bonus to the SK as a whole is rediculous. Its our money that they are spending and I, along with many other EU citizens, would rather have that money in my pocket to spend rather than subsidising students from a bankrupt country.

    • Dimos

      From the Greek government? You must be kidding. The government pays no money at all for any students in Greece.

      They get the money from their parents who are also doctors or own a pharmacy.
      So, it’s not your money that they are spending. Its their parents money, who will charge you 100 euros just by entering their office.

      Cheers!

  2. George M

    Yea right Domestos ….and why are the Greek Students in Slovakia ? Because of the weather, the wonderful historic culture and they love Ice Hockey ? ….No, because it in much cheaper to have yet another subsidised way of living on the backs of others in the EU and to be Cheap Trained here and while Slovakia and the rest of the EU pay your Greek Bills for your own massive over spending, as Greeks continue to pounce and beg off the rest of us EU poor Taxpayers .

    Personally I believe we should just bulldozer Greece into the sea, or let the German`s run it as Club Med holiday camp, or let Turkey run the place again, as a they did for hundreds of years .

    • Dimos

      The reason why the Greek students are in slovakia is because it’s very hard to get into the medicine/pharm. schools in Greece. You see, we do not have private education, thus there are not tuition fees in the Greek univirsities. They are public, which means that the best get into the universities, not the rich ones.

      So, with that in mind, the rich students come to Bratisolava and other Eastern European countries to get their degrees in medicine/pharm. Slovakia and these countries take advantage of that and sell out medicine degrees with 10k per year. Now, if you think that 60k tuition fees and around sum 1k per month over 6 years is cheap, then you must be a rich man. In that case, what are you doing in poor Slovakia?

      Turkey run the place for around 200 years in the past, but we ruled Turkey for centuries my friend.

  3. Dimos

    Right!
    Whole Slovakia Groaning over Paying for Greece……but as far as I know:

    -Around sum 80% of III Veze appartments are resided by Greek students
    -100% of Greek students live at the Old town (very very few of them live with roomates, still at the centre). Have you met many Slovak students who live on their own in the Old Town?
    - Eurovea cafes are full of Greek students, who eat drink, have coffee there.
    - I was at the Club once and 90% of the customers were guess what…Greek students! The same applied to Primi, and Traffoo.
    - 10,000 euros tuition fees for a Greek medicine student per year. That’s overall 6*10,000=60,000 euros for each student only tuiton fees

    I can mention so many examples, but let’s accept it…Greek students leave A LOT of money in poor, miserable Slovakia.

  4. Dave Crawford

    The sorry state of Greece at the moment is the fault of successive Govts. spending money they didn’t have BUT let us not forget who the real culprits are. The analysts, who quite happily pontificate on the state of the country on our TVs every night, are part of the same global banking system that lent Greece the money in the first place. They obviously didn’t do a good job did they? The average housewife could see Greece was in trouble years ago but they continued to lend money to the country. Why? – quite simple – they were on a winner no matter which way the cards fell – if Greece repaid the debts they profited, if it defaulted they could sell the debt, to say China, at a profit and they knew that when the crap hit the fan Europe would have to step in and bankroll the Greek repayments – still in profit. Who decides a countrys’ credit rating? – part of the same global financial system, every interest rise generated more profits.
    By all means criticise the Greeks for being greedy but save some venom for the fat cats who have and still are making a handsome profit while the ordinary people of all EU countries have to dig a bit deeper to keep them in the luxury they enjoy.

  5. EXPAT

    One thing I learned from Slovakia… How to save my MONEY!!! You don’t spend unless it is in the bank! If the bank has no money, no one spends! Come on, give a man a fish, feed him for a day, teach him to fish, feed him for a lifetime!

    • Ian McLeod

      Very true Expat. I was taught “If don’t have the money to buy it then save up for it and only buy what you need”

  6. Ian McLeod

    We are all groaning about Greece. Thats all you hear about Europe is what Greece and their debt and then Spain and Ireland Italy Portugal and we keep throwing money at them. If a small country like Slovakia can budget why can’t the rest?

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