Based on the Greece's Economic Woes (p. 111) case below, analyze the nation's current and future financial status and compare it with the nation NORWAY.

MINI CASE: GREECE'S ECONOMIC WOES In 2008 and 2009, international financial markets suf- provided a E110 billion bailout loan to Greece. Another fered large declines in stock, bond, and real estate loan of E110 billion was implemented in 2012 to increase prices that caused a slowdown in global economic debt relief. In December 2014 the Troika was expected to growth. Many emerging market countries were ad- evaluate further funding needs. For Greek citizens, times versely affected. As economic woes deepened, many are tough due to austerity programs that cut govern- developing countries around the world suffered from ment support of social safety nets for poor and elderly high government debts accumulated in the booming people. Some experts believe that Greece should exit the economic times prior to the financial and economic cri- euro and resume the drachma at a devalued rate. Oth- ses. These debt problems lingered for many years after ers argue that if other countries, such as Italy and Spain the crises with broader implications to other nations. followed Greece and exited too, the euro itself could be A prominent example is the case of Greece, which in danger of surviving. Also, the concept of European in- experienced a government-debt crisis. In 2000 to 2004 tegration would be seriously damaged. Greece may be a the country was the fastest growing in the Eurozone. relatively small country in the Eurozone, but events there But large fiscal imbalances occurred thereafter due to are having historic impacts on all European countries. excessive government spending and related borrowing. Also, after the introduction of the euro in 2001, Greece's current account deficit worsened. The high value of the euro was reducing their exports and devaluation was not possible to boost exports. Other problems with tax eva- sion and inaccurate economic statistics became appar- ent. A loss of confidence by investors in financial markets caused rating agencies to downgrade their sovereign government bonds to junk bond status in 2010. To head Source: Based on Stijn Claessens, Giovanni Dell'Ariccia, Deniz Igan, and off sovereign default, the Eurozone countries, the Euro- Luc Laeven, "Cross-Country Experiences and Policy Implications from pean Central Bank, and the IMF (known as the "Troika") the Global Financial Crisis," Economic Policy 25 (2010): pp. 267-293