Economic impact of a Greek Euro Exit
Impact on Europe and other countries
In a study commissioned by the Bertlesmann Stiung Foundation, Germany’s largest
private operating non-pro#t foundation, Economic research group Prognos took a look at the
consequences of a Euro exit by the four southern nations; Greece, Spain, Portugal and Italy. It
concluded that it would have a “devastating impact” and would cut global GDP by 17 trillion
euros, or approximately $23.5 billion.
A Greek exit, by itself, would result in a €164 billion loss in GDP, or €14,300 per capita, by
2020, the main reasons identi#ed being a devaluation of currency, unemployment, and a fall in
domestic demand. On a global level, this exit would result in a loss of €674 billion to global GDP.
Since a Greek exit has the potential to create a domino-e8ect, and incite other crisis-
ridden Southern-Europe countries to want to do the same thing, the study also took a look at
what would happen should they leave too. For example, if Portugal joined Greece, it would
result in a 2.4 trillion euros loss to global GDP, and a loss of 225 billion euros, an additional 99
billion euros of necessary debt write-o8s, and per capita losses in income in 2,790 euros over
eight years, in Germany alone. The U.S. would have to bear 365 billion euros and China 275
billion euros losses.
These numbers start becoming particularly threatening once we start including Spain,
resulting in a 7.9 trillion loss in global GDP. The impact on Germany alone would increase to 850
billion euros by 2020, totaling over 1.1 trillion euros if we include the 266 billion euros of
outstanding debt that would have to be waived. Per capita income losses in Germany would
amount to 10,500 euros during that same period. In the U.S., this would translate into a 1.2
trillion euros loss of growth and a loss of 3,700 euros in per capital income, much less however
than France and Spain, which would see a fall of 18,200 euros and 16,000 euros in their per
capita income, respectively.
Finally, the worst case scenario, in which Italy would leave also, would drive Europe into
an unruly situation, with big chances of there being a severe international recession and global
economic crisis. Germany would see losses of 1.7 trillion euros, would have to write o8 455
billion, and would be the only European country to see the number of unemployed rise by more
than a million by 2015. Global GDP losses would add up to 17.2 trillion euros more than double
