The eurozone’s former communist nations, including Estonia, Latvia, Lithuania and Slovakia, have themselves endured painful reforms and austerity programmes within living memory. Perhaps as a result, they are now among those taking the hardest line on Greece following that country’s rejection of creditors’ bailout terms.
EurActiv reports the eurozone’s former communist nations have long insisted they are too poor to pay for wealthier Greece’s mistakes. They cannot understand why it should be excused from reforms and austerity measures laid out in the 240-billion-euro bailout when they underwent similar strictures.
The Baltic states of Estonia, Latvia and Lithuania implemented drastic austerity measures to recover from their own deep recessions following the 2008/9 global financial crisis. This led them towards eurozone entry and the stable economic growth of around three per cent the region now enjoys. Estonia records the eurozone’s lowest debt-to-GDP ratio of 10.6 per cent.
Although Lithuania and Slovakia can take a degree of comfort from the fact they did not give cash to the previous Greek bailouts, they are still involved in guarantees. Estonian President Toomas Hendrik Ilves (pictured above) tweeted yesterday that “Greece’s creditors (are) not just banks. Eurozone countries poorer than Greece stand to lose up to 4.2% GDP”.
Ilves followed by tweeting a chart headed ‘The Pain Of Greek Bailouts’ illustrating other nations’ per capita exposure to Greece as a share of average monthly income. As you can see, it does not make comforting reading for the likes of Estonia, Slovenia, Malta and Slovakia
So this is perhaps why the less well-off €-zone might be slightly distressed. As I said, it’s NOT “the banks”. pic.twitter.com/SkP9i96VjW
— toomas hendrik ilves (@IlvesToomas) July 6, 2015
The outrage is not limited to the political classes. AFP reports a waitress from Bratislava, capital of Slovakia where the average monthly salary is €880, saying:
“I hear some Greeks have pensions over €1,000 a month. That’s outrageous. I refuse to pay for their debt while they are making fortunes compared to my salary.”
Sympathy was equally hard to find in Riga, capital of Latvia, with one office worker asking: “When we went through the international bailout, did anyone come to rescue us?”
A local businesswoman was also showed her anger, saying: “I have no sympathy for the Greeks. They should have started paying taxes long ago. If they want money from Europe, they should have started saving! How is it that we could endure all of it and they can’t?”
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