DRAFT
PIIGS
PIIGS it’s an acronym, with bad connotations, used in economic and financial areas. Its letter of
the word refers to one country of southern Europe. All these countries (Portugal, Italy, Ireland,
Greece and Spain) have something in common: high deficit and problems in the balance of
payments.
Everything started after the big financial crisis in 2008. The crisis didn’t affect at the same level
to each country of the Europe zone. Because of that, some investors began to call “PIIGS” to
these countries referring to economies in a death spiral. However, it’s obviously that not all of
them have the same amount of public debt, but almost all needed a financial rescue in the last
years. Probably, Greece has the worst situation because it has needed three rescues, two in the
same year (2010), but not only for that, also it has a very high rate of corruption and it is seen as
the most corrupted country of the Europe Union.
Following the last sentence, the extremely bad situation of the PIIGS is highly connected with
the corruption - 3 PIIGSs countries are in the top 5 of corruption in Europe according to several
sources. But in this sense it’s important to exclude Ireland and probably soon it won’t be part of
this group. The last months show that Ireland is becoming an example for the rest of Europe,
especially for PIIGS. The unemployment rate on the island fell in November to 10.7% and the
GDP has grown by 7.7% which is a similar rhythm in countries like China.
To sum up, we cannot avoid the politic situation and the social climate in each country, because
all are factors that affect to their economies and evidently, it can’t be possible solve financial
problems or adjust the economic system with scandalous levels of corruption.