The World Bank has recommended Russia to learn from Greece.
The World Bank recommended Russia to find the way out of the crisis by the Greek scenario, as TASS reported. According to the World Bank’s Chief Economist for Russia Birgit Hanzl, Greece decided to significantly reduce wages in the public sector, even despite mass social protests.
According to her, the key task of the Russian government now is to ensure macroeconomic stability, including stability of the financial sector. “It is necessary to return the confidence both to businesses and households that they can continue to invest, to buy things in a normal mode, in spite of the uncertainty level existing in the economy at the moment and likely to persist in 2015” - she stated. Hanzl added that it would require making a difficult strategic choice going beyond the macroeconomic decisions. This choice involves “open labor market” for business.
Greece has experienced six years of economic depression in 2008-2014 years with a total GDP’s fall by almost 30 percent. This was caused by an enormous public debt still exceeding 150 percent of the country’s economy. Despite the fact that Greece started to show some signs of economic growth by the end of last year, its economic recovery is very slow. The opposition accusing the authorities of unjustified application of too tough austerity measures, offers to write a portion of the Greek debt off or to quit the Eurozone.
Author: Anna Dorozhkina