Macroecons project.docx - ECON 1016 u2013 Macroeconomics 1...

ECON 1016 – Macroeconomics 1
Policy Brief Project
Assignment
Group 125
Lecturer/Tutor name Saminathan Malayandi
Lecture/Tutorial day and
time
ECON 1016 – LF02
Tuesday 12.00pm- 3.00pm
All members should agree with the following contribution weights to the group assignment.
Group members
Only one submission per group
Student name Student
number
% contribution
(must add up to 100%)
Signature
(take a
picture of a signature and
paste here)
Final mark
(tutors
only)
BONG WEE
LOONG*
S3771788 25%
TAN GUO YI
S3772768
25%
DANN CHIA
RONGYAO
S3771847 25%
PEK JUN HAO S3772536 25%
1

Please indicate using * in student name who will be submitting the assignment in Turnitin (in Canvas) on the group’s
behalf.
Part A
Name of country: Greece
Indicator 1: Unemployment Rate (Long Term)
Comments and observations
According the chart above, Greece unemployment rate did not stop rising until 2013 whereby
they reached the highest unemployment rate, 28%. It is also the highest unemployment rate in
the euro zone since the financial crisis hit Greece. From year 2014, Greek National Reform
Programmed and public employment service came out with policies to improve labor market
outcomes and to boost job creation. However, over these years it has not improved much
despite having these policies, the unemployment rate in Greece still remains high, 18%.
Unemployment Rate (Short Term)
Comments and observations
As recession hits Europe (Greece), sales and revenues would be affected. For the business to be
able to sustain, cost has to be readjusted, cut back on hiring new staffs or even freezing hiring,
2

wages would cut down and retrenchment. From the graph above, it shows the unemployment
data for year 2018, which has high and unstable unemployment rate. When business cycle is
low, cyclical unemployment increase, resulting in a constant growth rate of high unemployment
rate as seen from the diagram.
Indicator 2 : Government debt (Long Term)
Comments and observations
We can observe that there is a sudden increase in national debt from 2009 to 2012, that is
when the government of Greece find out that the budget deficit is double the previous
government’s estimate. In 2012, Greece manage to loan funds from other countries in the
Eurozone to repay its high debt. However, it was a short-term solution and we can see that the
debt started to raise back again. The increasing and high debt to GDP ratio indicates that the
country might have problems to repay its debt causing investors to lose confidence to invest in
the country. When the debt is greater than how much the country has produced in a whole
year, the country will find it difficult to sustain its economy and cause uncertainty and losing
confidence amongst investors.