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The Weekend Neos Kosmos : 12 December 2015
DIGITAL.NEOSKOSMOS.COM THE WEEKEND NEOS KOSMOS | SATURDAY 12 DECEMBER 2015 21 NEWS OPINION BY FRANZ OSSING AND LAUREN LIPUMA centuries order to fund this consumption you need inflows from abroad, leading to the big current account deficits recorded in Greece before the crisis." The Brookings study argues that to a significant extent, it was the unyielding stance of Greece's foreign creditors over the past two centuries that was responsible for the length and toll of its bankruptcies. However, despite the similarities, today's crisis is different in one key respect: The borrowing in the previous cases was predominantly a matter of necessity (to fund a revolution, build an army and infrastructure, manage refugee inflows from Asia Minor). In the 1981-2009 period, and particularly since Greece's entry into the eurozone, the deficits were bankrolling consumption. "From a Greek point of concerned, the study presented at the Brookings Institution adopts the line of economists such as Daniel Gros and Hans-Werner Sinn, who see Greece's dependence on foreign capital as the main cause of its fiscal collapse. However, this raises the question: If, in order to avoid overborrowing, Greece needs to depend on domestic funds, doesn't this strengthen the ‘deadly embrace’ between government and banks, which has been such a major factor in the spread of the crisis? "The only alternative is domestic savings," Gros tells Kathimerini. "These savings do not have to transit via banks. It could be corporate sector savings or even, heaven forbid, government savings. Unless Greece gets its savings rate up to over 20 per cent it will never be able to grow in a sustainable way. Banks are leveraged institutions. They thus magnify either strength or weakness. But banks do not create the 'original sin', which in the case of Greece is insufficient savings - and was so long before the euro." Gikas Hardouvelis, a professor of economics at the University of Piraeus and a former finance minister, says that the low level of savings in the past few decades "reflects the surge in consumption, which to a great degree concerned imported goods. In view, today's bankruptcy is the most 'sinful' of all," stresses Hardouvelis. For Kostis, the recurring pattern is not so much the overly harsh treatment of Greece by its official creditors, but rather the "perennial failure of the Greek political system to deal with problems in the economy in a timely fashion, or to manage the situation when conditions become most dire". The foreigners therefore, the academic argues, "not out of magnanimity but in order to protect their interests, emerge as forces modernising the Greek state after every bankruptcy". Kostis mentions the founding of the Bank of Greece in 1928, under pressure from Greece's foreign creditors and particularly the British, despite intense reactions from the domestic political system. He argues that the creation of the central bank was part of the British strategy for regaining economic superiority by linking the drachma to the pound in the framework of the gold standard, with the Bank of Greece acting as the guarantor of monetary stability. For Greek politicians, however, who had become accustomed to using the government's cash reserves to issue loans through the National Bank of Greece, the idea of a central bank was highly problematic. Source: Kathimerini Seismic risk in eastern Mediterranean higher than previously estimated The eastern Mediterranean is more seismically active than previously assumed, a new study finds. On a geological time scale, seismic activity around the island of Crete has generated large earthquakes in bursts, potentially increasing the future risk for earthquakes and tsunamis in the region, says the new study, which was accepted for publication in Geophysical Research Letters, a publication of the American Geophysical Union. The Mediterranean basin consists of several tectonic plates, a result of the collision between the African and the Eurasian Plates. The way these plates interact makes the eastern Mediterranean particularly prone to earthquakes, yet scientists have been puzzled by the fact that the region has experienced only two known earthquakes with magnitudes larger than eight in the past 4,000 years. South of the island of Crete, the African Plate subducts under the Aegean microplate in an arcshaped region known as the Hellenic margin. In the new study, researchers explored the earthquake history of this subduction system to gain a better understanding of the key processes that drive the generation of mega-earthquakes in the area and how often these events occur. “We study the Hellenic subduction margin going back to about 50,000 years, which is about 10 times the time window of paleo-earthquake observations in the eastern Mediterranean that we had before,” said Vasiliki Mouslopoulou, a geoscientist at the GFZ German Research Centre for Geosciences in Potsdam, Germany, lead author of the study. “For the first time ever, we were able to chart the spatial and temporal pattern with which mega-earthquakes rupture the Hellenic margin.” In this study, researchers integrated field studies with radiometric dating and numerical models for a section of the Hellenic margin that straddles the island of Crete. The scientists identified relics of shorelines along Crete, which are today elevated up to 23 metres (75 feet) above sea level. Each shoreline is thought to represent the sea level at the time of its formation. Each shoreline’s altitude relative to sea level reflects the total vertical movement it experienced due to earthquake motion, according to the study’s authors. By radiocarbon dating the fossilised marine fauna trapped in each paleo shoreline, the researchers found that during the last 50,000 years, both western and eastern Crete have been lifted uniformly about 100 metres (328 feet) above sea level due to at least 40 earthquakes of magnitudes greater than eight. The origin of these quakes was offshore, on three seismic faults that extend along the western and eastern sections of the Hellenic margin, according to the new study. The study shows that the faults on the eastern segment of the margin are capable of producing large earthquakes, instead of slipping without producing any seismic shock, as was previously thought. This implies that the seismic hazard in the eastern Mediterranean is significantly higher than previously assumed, according to the study’s authors. Yet another surprise was the strong clustering of earthquakes in the time period analysed. “We also found that, in contrast to most subduction margins globally, great earthquakes in the Hellenic margin are strongly clustered in time,” Mouslopoulou said. “The data show that most of these paleo-earthquakes occurred over a time period of about 10,000 years, while there were long periods (up to 20,000 years) of relative seismic quiescence.” For example, the new study finds that the fault beneath western Crete appears to have ruptured every 4,500 years when its activity is averaged over the last 50,000 years, as frequently as every 1,500 years between 5,000 and 20,000 years ago, and not at all between 0 and 3000 years BC. The other two faults exhibited a similar pattern, according to the study. The high variability in the occurrence of large earthquakes in this region makes calculating their recurrence a great challenge, according to the study’s authors. Therefore, while the Hellenic margin is currently experiencing a seismically quiet period, the study suggests that future great earthquakes can be expected beneath both eastern and western Crete, and precautions such as tsunami early-warning systems and earthquake-resistant construction will have to consider this increased potential risk. * Franz Ossing is the head of public relations at GFZ German Research Centre for Geosciences. Lauren Lipuma is a public information specialist at the American Geophysical Union.
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