A Brief History of Greece

A short part of my newsletter regarding the European Crisis. If you would like more information please contact me to subscribe. Enjoy.

Geopolitics of Greece

Greece has defaulted on its national debt five times since it won its independence from the Ottoman Empire in 1828. This long history of financial trouble has two main elements: Greece’s strategic location for foreign powers, and economic stagnation. Both elements stem for Greece’s geography and will continue to influence Greece’s role in Europe.

Located on the Mediterranean boundary between Europe and Asia, Greece is a nation centered on a mountain covered peninsula with control over the Aegean Islands. This strategic location has long been a battle ground for foreign powers wanting to control the waters of the Mediterranean and Black Seas. The battle for ownership of Greece started when England and other European powers financially supported the Greek rebellion against the Ottoman Empire in the 1820’s. During World War I Britain used Greece to launch several military campaigns against the failing Ottoman Empire. The next world war also saw Greece as the focal point of Axis attention when the combined armies of Italy and Germany invaded and defeated the Greek and Allied forces. Greece suffered terribly under Axis rule and the conclusion of the war found Greece crippled. To stop the spread of Soviet Communism after World War II the United States under the Marshall plan sent supplies and financial aid to the Greek population to help rebuild and stave off Russian attempts to control the country. For the remainder of the Cold War, Greece received significant amounts of financial aid from the United States and NATO to contain communism in Asia.

For its entire modern existence Greece has had a foreign benefactor willing to lend large amounts of money in return for allegiance. With so much money poring into Greece over the last 180 years it might seem surprising that the country has defaulted on its debts five times, but the same geography that made it a natural buffer for foreign powers also prevents economic development. The rough mountains of the Greek mainland and the thousands of small islands in the Aegean Sea increase the cost of infrastructure exponentially. Greece in the past, was able to leverage its strategic position to spend beyond its means by receiving foreign aid, but with the end of the Cold War Greece was no longer needed to contain Russian expansion. The fall of the Soviet Union left Greece without a benefactor for the first time in its modern history.