Who is troika

The European Commission is an executive arm of the EU. It does the day-to-day work of implementing EU policies and spending EU funds. But it must still answer to the member states of the EU. Next up, the International Monetary Fund.

Since then it has often lent money to countries in trouble, such as Mexico in the eighties and Argentina in It has set strict goals for the Greek bailout, but because it is only one of the lenders it only has so much power.

No — troika means a group of three. The European Central Bank is the third entity. Besides, the preferred targets for the Troika are wages, working hours, and social expenditure — again preserving the interests of the richest. Furthermore, the interests of private creditors, banks and other financial institutions are fostered by passing the debt onto public hands, while consolidating and raising it to unsustainable levels and demanding economic reforms and austerity measures on an extremely harsh level.

These measures and reforms, the conditions that countries have to fulfil to continue receiving money, are established in a sort of contract, called a Memorandum of Understanding MoU. The Troika organises review missions in which it visits the countries it has a MoU with; if it concludes that a country has not done enough in exchange for the money, it can decide to postpone payment of the next tranche.

The Troika thus has a very strong influence on the national economic and financial policies of the countries that are under its rule. The Troika acted for the first time in , in Greece. This started a downward spiral of pension reductions, wage cuts, higher taxes, lay offs and privatisations: the Troika had entered. After Greece, three other European countries were placed under scrutiny of the Troika: Ireland in December in December , it left the Troika program, at least formally , Portugal in May and Cyprus in April The harsh and dogmatic language makes this read like a fairytale, where Cinderella Greece is unfairly persecuted by the evil three ugly sisters harsh Troika.

Why do international markets and creditors appear to favour some countries more than others? What would it mean to build a successful economy less dependent upon international markets and public debt credit ratings? It is not assumed that just by the country being sovereign its economy would flourish but it is a necessary condition for it. Greece is a heavily import-dependent country.

And spare us the wild dreams of funding your expansionary budget through gas fields in the Aegean or big brother Vladimir. Search for:. Blog Team November 15th, Ideology not economics explains why the Troika treated Ireland less harshly than Greece 3 comments 4 shares Estimated reading time: 5 minutes.

Policy transfer is not always easy The policy transfer literature warns that imposing policy in this way is far from straightforward. Elaboration based on information from the European Commission and Fulton The legacy of the Troika?

About the author Blog Team. The other two questions can be addressed on the basis of the above two answers.