A Study Of The Greece Debt Crisis

In the wake of the global finance crisis, the Greece debt crisis taken place at the end of 2009 greatly shocked the whole world one more time. Because of the contagion mechanism, the Greece debt crisis swiftly evolved into a crisis of whole Europe, which brings a major uncertainty to the global economy. Today, the Europe debt crisis stemmed from Greece is seen as one of the biggest obstacle in the way of world economy recovery.Against the background of the global crisis and in the unique economy environment, the arrival of the Greece debt crisis has its own feature. Essentially, the Greece debt crisis is a sovereign credit crisis of the Greece government, and to some extent, an extension of the prior global finance crisis. In the range of the whole world, especially in advanced countries, the risks of sovereign credit have significantly accumulated to a high level, which triggered a worry about an outburst of global debt crisis. Therefore, a study in the Greece debt crisis will contribute to avoid this kind of crisis in other countries. For China, which has an immense foreign exchange reserve and faces enormous local-government debt risks, the study also has a positive significance.This paper uses a method including theory analysis and empirical analysis to make the study, putting emphasis on the impacts,causes and enlightenments of the Greece debt crisis. The whole paper consists of five chapters.Chapter 1 is an introduction, it describes the background and significance of research, makes distinction of a few concepts between which exist some relations but easy to confuse, carries out the collation and evaluation of literature at home and abroad, and points out the research methods and ideas, and the innovation and weakness of this article.Chapter 2 reviews the evolution of the Greece debt crisis and the reflections of EMU and IMF, and summarizes up the features of the crisis. In doing so, a cognition to the crisis on the whole will come into being.Chapter 3 analyses the impacts of the Greece debt crisis. The impacts are displayed as follows:first, Greece has to endure the pain resulted from its necessary fiscal adjustment in a long period. Secondly, the Europe economy recovery process,the independence of ECB and the integration process of EMU are suffered from the crisis. Thirdly, the crisis brought any major uncertainties to the world economy. Finally, the export of China is affected, and China confronts a more serious press in resisting hot money entering into China.Chapter 4 comprehensively and systematically analyses and summarizes up the roots of the Greece debt crisis. At the beginning, it clarifies the ordinary mechanism of debt crisis. After this, it demonstrates that Greece is on the way to a possible debt crisis through an indicator analysis. Then, through a dynamic sustainability analysis, it points out that the Greece's debt is unsustainable, thus the Greece debt crisis can not be avoided. Further, the article finds out the economy roots of the crisis from Greece's fragile economy system and the Euro mechanism effect on Greece under the global finance crisis environment, which are the fundamental causes of Greece's debt unsustainability. Finaly, the article points out that the rating of international rating agencies is the external factor triggering the Greece debt crisis. On the whole, the analysis is developed step by step.Chapter 5 derived some enlightenments from the Greece debt crisis on the base of former analyses. They include that debt scale must adapt to economy developmental level, that a healthy real economy must be cultivated, that China as an important creditor should enhance assessment to its safety, that the risks of China's local government debt must be taken seriously, that China should actively carry forward the RMB internationalization, that we should objectively look at the roles of international rating agencies, that advanced countries should be watched closely for the high risks of their debts, and that China should be careful to join in the Asia monetary area.