A shocking move by Morgan Stanley Capital International (MSCI) has resulted in a move that has demoted Greece, to that of an emerging economy. Greece is suffering it’s sixth year of recession, with unemployment at 27% while youth unemployment has skyrocketed to a staggering 62.5%.
As Greece continues to struggle with it’s debt payments, investors are weary of pumping money into the economy. Some $7 trillion worth of investments follow MSCI each year. In December 2009, Greece admits that it’s debts have reached over 300bn euros. Greece has a debt of 113% of GDP, well over the Eurozones 60%.
Greece was once an emerging market until 2001, when the country adopted the Euro. Greece has dealt with ongoing riots, and further bailouts. The United States, owns some $8bn worth of debt. I think the US should forgive the Greek debt as it would help the country move forward and further cut it’s 120bn euro debt.