(Greece) – Greece’s economy has been struggling since around the time of the first bailout in 2010. Now in 2016, they have entered into a third round of bailout talks. Greece has the 45th largest economy in the world with its Gross Domestic Product, or GDP, estimated at about $290 Billion Dollars a year. Twenty percent of their Gross Domestic Product comes from tourism, and the Greek government hopes to exceed, or at least meet this typical average. Although the Greek economy is the 45th largest in the world, the debt far exceeds the national output, placing the country in a precarious position. The Greek Parliament met over this past weekend to vote if they would agree to austerity measures required by the international creditors. They voted yes, which means that the creditors are now able to review the bailout package in earnest. The events surrounding these new bailout talks have been controversial and have spurred protests and strikes, as well as obtaining some support.
Still, the question remains. How will Greece get its economy back on track for good? The government hopes that tourism will play a big part in that. There was a time when people all over the world would flock to Greece in large numbers to have a relaxing holiday. In recent years, the number of tourists has dropped off considerably. This summer, however, tourists are expected to flock to Greece once again and even break records that have previously been set. As the Greek government and the International Monetary Fund looks to nail down the details of the third bailout, tourism is looked at as an industry that can help pay off its debts. In particular, there are some tax hikes that could generate more revenue from tourism, such as higher taxes on accommodations, alcohol, and coffee.
While the hope is that these tax hikes will stimulate the economy, they could have the opposite effect. The opposition, headed by Kyriakos Mitsotakis of the New Democracy Party has said that these tax increases could have the opposite effect. Still, people are expected to flock to Greece in larger numbers as tourist spots all over Greece prepare for the height of tourist season over the summer.