Greek Growth 1923–1962

Greek economic developments in the period between the Treaty of Lausanne in 1923 and Greece’s association with the European Community, in November 1962, can be broken down into several distinct sub-periods. The first sub-period is between 1923 and the start of World War II. During these years, Greece’s foreign policy moved away from the previous objective of ‘Greater Greece’ to economic development; albeit with great difficulties, because of the need for massive refugee resettlement occasioned by the war with Turkiye and the great depression; and without much external assistance. The second sub-period is that of the War itself, 1940–1945. The third is between the end of World War II and 1953. Following the War, almost chaotic conditions prevailed in the Greek economy due to the destruction from the War and the subsequent civil war. The political situation, which did not allow postwar reconstruction to proceed smoothly, was probably the effective constraint on Greek economic growth until 1952. The last sub-period starts with the major economic reforms of 1952–1953 which set the stage for stabilization and significant growth during the decade 1952–1962. This chapter discusses briefly economic developments between 1923 and 1952. Then, economic conditions in Greece in the decade 1952–1962 are analyzed in some detail. The discussion focuses on foreign trade and finance issues and argues that Greece’s growth during this period was primarily constrained by developments in its balance of payments.