By Prof. Dr. Sri Adiningsih, M.Sc. and Rosa Kristiadi M.Comm

European economic crisis which begun in 2010 shows no signs of abating.  The ongoing economic crisis  in the Eurozone  region  is attributable to the large public debt , which started to emerge in 2000, reflected in  a significant increase in the  ratio of government debt. In 2000, the ratio of government debt for Greece was just 77% of GDP,   but in 2012 it had surged to 170%. IMF predicts that Greece debt ratio will rise above 180% in 2013, due to the widening budget deficit. Such a condition is very much in contrast to Maastricht Treaty rules that impose maximum limit of 60% on the country’s debt to GDP ratio and a deficit of 3 % of GDP.  The theory is that economic uncertainty in the regional economy is unavoidable if the two ratios go beyond the maximum limits imposed read more