Background on public debt of Greece

Despite its third bankruptcy in Trikoupi and the humiliating defeat by the Turks in 1897, Greece has managed to recast, to organize the Makedoniko Struggle to release Macedonia and avoid further payments stop after the Asia Minor Catastrophe.

“To control the finances you. The famous ILO (International Financial Control), these three terrible letters of my generation who saw all the boxes of matches ‘Greek Monopoly’. And more subtle in many others, daily consumption products to any profits leaving the funds directly to our creditors. ” Experienced something like this for many years ordinary citizens the consequences of the bankruptcy of 1893, he writes Richard Someritis “Step”.The IEA, which was imposed on our country after bankruptcy on Trikoupi will be waived after 80 years in 1978!
By 1909 the IEA had exhausted their citizens, and taxes had become unbearable. The Athenian guilds, with their resolution in December 1908, declared that no longer accept new taxes “to maintain that the authority of the party.
After the Asia Minor disaster, bankruptcy was avoided with the help of a loan by the League of Nations High Commissioner for Refugees and a forced internal loan. The then Finance Minister P. Protopapadakis cut in half notes, took part in the movement and exchange of the remaining half with domestic securities loan.
From 1924 until 1930 Greece entered the 1.16 billion gold francs, of which 78% was loans. The loans were used for the rehabilitation of refugees, to service the external debt, stabilizing the drachma and the production reconstruction. Overall, from 1824 to 1932 that Greece borrowed from abroad 2.2 million gold francs.
By 1932 we had paid 180 million more than what we borrowed and owed back 2 billion gold francs!
The final settlement of prewar debt of Greece was by Spiros Markezinis the period 1952-1953.
By 1945 there will be no new external borrowing, and will freeze because of the global crisis, the service of old.
Salt, oil and matches …

Strict financial control of Greece since 1898

Four years after the bankruptcy of 1893 and under pressure from the humiliating defeat of 1897, Greece imposed on the International Financial Control (IOC) with the law VFITH/23-2-1898 in the form of “financial aid”.
The financial “help” they offered to loan the foreign bankers in Greece was accompanied by hard political terms, of course, by granting the right to control the Greek economy. As historians note, the control imposed on it in Greece was heavier than the controls imposed in other underdeveloped countries such as Tunisia, Morocco, Egypt, Turkey.
In October 1897 arrived in Athens the envoys of the Great Powers to draw law against which to establish and operate financial control. Negotiations between the Greek government and the committee about the levels of control and economic conditions were difficult.
The committee concluded on January 21, 1898. The relevant law was passed by the House on February 21, 1898 (Act VFITH) and the International Economic Committee, known as International Financial Control, was launched on 28 April 1898.
The panel consisted of six members-representatives of each of the forces that had signed a preliminary peace treaty and was in direct contact with the Greek Minister of Finance.

To service the public debt assigned to the ILO, the following revenue sources:(1) monopolies of salt, oil, matches, playing cards, cigarette paper, emery of Naxos, (2) tobacco consumption tax, (3) stamp, (4) Customs duties Piraeus .
The ILO has also had oversight of the departments were responsible for the collection of collateral proceeds.
Stop paying and Venizelos

The government of Eleftherios Venizelos, after the Wall Street crash in 1929, asserts that the Greek economy is not threatened by the international financial crisis and gave verbal assurances to the “public credit and deposits.
The international crisis begins, however, be visible in the real economy. First in agriculture. Exports of tobacco and raisins collapse, prices plummet, the output remains indisposed. Then limit the migration and the maritime exchange. These problems are compounded by the speculation in gold and foreign exchange. Gradually close the valves and external borrowing.
The big hit comes in September 1931. The drachma enters the vortex of the crisis when he leaves the rule and the British pound which was connected.
In six days the Bank of Greece has lost a total value of foreign exchange 3.6 million dollars in an orgy of speculation and fygadefsis capital abroad. The Greek financial crisis will peak in the spring of 1932. Stocks in gold and foreign currency reduced dramatically and Labor Day of 1932 the government declared “stop payment”.

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