Greece

Greece Independent since 1829, it aimed at territorial extension to claim historic Greek provinces. In the late nineteenth century, a policy of extensive infrastructural, military, and economic investment, as well as gains in administrative efficiency, plunged the state into large international debt. At the same time, it provided the basis for its victory in the two Balkan Wars (1912–13), as a result of which Greece doubled its territory. During World War I a fundamental constitutional, political, and social conflict erupted about the stance Greece should take. While the Germanophile King, Constantine I, insisted on his country's strict neutrality, his liberal government advocated joining the war on the side of the Allies. The King dismissed his ministers, who proceeded to form an alternative government in opposition to him. Given this domestic instability, external pressures from the Allies and the Central Powers made neutrality increasingly difficult to maintain. In 1916, Allied troops entered Greece in support of the liberal government, and forced the King into exile.

After World War I, under the Peace Treaty of Sèvres, Greece gained its greatest territorial expansion in the nineteenth and twentieth centuries, when it came to occupy significant areas of Asia Minor. It was forced to surrender these in the campaign of Kemal (Atatürk) in the Greco-Turkish War of 1921–2. The Treaty of Lausanne resulted not just in territorial losses to Turkey. A population ‘exchange’ led to the expulsion of most Turks living on Greek territory, while in return Greece was faced with the integration of over one million Greeks expelled from Turkey. It achieved this integration through a large redistribution of land, which destroyed large landholdings and created a large group of small landowners, who continued to be the backbone of the Greek economy for the remainder of the century.

In the interwar years, politics continued to oscillate between monarchial government, restored 1920–4, and republican government, reintroduced 1924–35. In 1935, following the election victory of the royalist parties in 1933, a plebiscite resulted in the reintroduction of the monarchy. The royalist leader, Metaxas, became provisional head of government before being granted dictatorial powers. Even though the country had been riven with political instability compounded by the Great Depression, Metaxas managed to re-establish some stability, while his reforms were effective enough to enable Greece successfully to repel Mussolini's invasion in 1940. Unfortunately, this triggered an invasion by German (together with Italian and Bulgarian) troops in 1941. The brutality of the occupation forces led to the quick growth of the active resistance movement, ELAS.

Towards the end of the occupation, as victory came closer, the resistance movement was increasingly split between its Communist and non-Communist wings. After the expulsion of the Germans in 1944, therefore, a bloody civil war erupted, fuelled by the tensions between the US and the USSR in the emerging Cold War. It was in full force 1946–9. Ultimately, it was Truman's determination not to allow Soviet expansionism into Greece, and to fund lavishly the Greek anti-Communist forces as laid out in the Truman Doctrine, together with the end of Yugoslav assistance to the Communists, which led to the Communists' eventual defeat.

In subsequent years Greek politics remained unstable, with the role of the monarchy unresolved and as contentious as ever, and an even stronger role for the victorious military. Relations with its Communist neighbours continued to be uneasy, while its relationship with Turkey was fraught with tension. The only way the Greek government, under the major influence of Karamanlis, Georgios Papandreou, and, later, Andreas Papandreou, managed to cope with these difficulties was through rapidly expanding the state to embrace and bring into its fold the various polarized social groups. By contrast, Communists and other groups deemed to be ‘extremist’ were excluded from this social pact, partly through illegal and corrupt means. This system managed to keep social and political polarization beneath the surface, but did not tackle the role of the monarchy or the army. Differences over the rights of the crown led to a series of constitutional conflicts with Kings Paul I and Constantine II from 1963.

Disagreement about the power of the monarchy in the military, and impending army reforms designed to reduce the military's role as supreme actor on the political scene, led to an army coup in 1967, and the establishment of the Greek colonels' government. Their administration was even more inefficient than that of their predecessors, while their flagrant human rights violations increased internal opposition. They finally had to make way for the reintroduction of democratic rule under Karamanlis in 1974 after their ill-judged attempt to annex Cyprus through a coup against Makarios III, which was foiled by the invasion of Turkish troops there. In retaliation against King Constantine's initial support for the Greek colonels, 69.2 per cent voted in a plebiscite of 8 December 1974 for the abolition of the monarchy.

With army and monarchy thus discredited, politics entered a more stable phase. Karamanlis continued to dominate politics in the 1970s, successfully steering Greece towards entry of the EEC (European integration) in May 1979 (effective from 1 January 1981).

Under Andreas Papandreou's government, however, the funds flowing in from the EEC, as well as the USA, were not used to introduce greater efficiency into the economy. Unlike Spain or Portugal, which had similar economic structures at the time, the 1980s did not see an expansion of the country's industrial base, while the economic realm reflected the dominance in the political sphere of patronage and nepotism, stifling private initiative. As the economy remained in the control of around two dozen families, a black economy developed which by 1996 produced perhaps as much as half of the country's wealth. In January 1996 Papandreou was succeeded by the commercial lawyer Costas Simitis (b. 1936). He aimed at integrating the country more closely with the West, while introducing badly needed political and economic market reform. Simitis received a popular mandate for these reforms in elections in 1996 and (with a reduced majority) in 2000. Economic growth had picked up to over 3 per cent per year 1998–2000. Moreover, Simitis's reforms had been sufficiently successful for Greece to meet the criteria for entry into EMU. For this reason, Greece was the twelfth country to enter into the euro zone on 1 January 2001. In the late 1990s, there was a marked improvement in relations with Turkey. While disputes about territorial borders and Cyprus remained, a number of agreements were reached to allow Turkey to apply for membership of the EU.