When Greece imposed capital controls in the summer of 2015, the measures were a critical bulwark for banks left teetering after fears of a Greek exit from the European Union caused citizens to pull billions of euros in deposits.
Two years later, the country is a case study in capital controls. The measures prevented a collapse in the banking system, and predictions they would throw grit into the wheels of the economy haven’t materialized. Instead, controls have produced some surprising results, including helping Greece combat tax evasion, a perennial scourge.
As Greece’s creditors prepared to approve Thursday the final payment in the country’s up-to-€86 billion ($96.5 billion) bailout, there was no talk of lifting the measures—a reflection of the continued fragility of its battered economy.
PG View: So what pray tell happens when Greece runs through the last of the bailout money and is still a fiscal train-wreck?