"The scenario of Greece leaving the euro has become increasingly
popular over the past few months and has gained even more momentum
following the outcome of the recent Greek elections. The narrative
about a possible Grexit usually involves looking at macroeconomic
consequences within Greece itself and the Eurozone in its entirety.
A big fear is that Greece leaving the euro could trigger a domino
effect in the periphery of the Eurozone and the so-called P.I.G.S.
Nevertheless, for those like me, who are interested in higher
education policy the Grexit scenario imposes some specific
challenges for Greek higher education.
No euro and further austerity
First, we have to realize that Greek higher education is solely
funded and dependent on government funding. Greek higher education
institutions (HEIs) are not familiar with generating funding from
other income sources (i.e. research, partnerships and
collaborations). Additionally, the degree of internationalisation
of Greek higher education institutions is pretty low. This is
mainly due to their failure to offer programmes in languages other
than Greek and their inability to develop their international
reputation. This has reduced significantly the number of
international students who currently study in Greek HEIs as well as
the short-term prospects for attracting international students.
Therefore, in a Greek exit scenario where Greece will have to,
most likely, violently rationalize its public expenditure so as to
cover the existing government primary deficit, Greek HEIs will see
their budgets cut or even disappear without being able to source
funding from alternative sources. It is very likely that several
Greek higher education institutions will close as they will be
unable to source their operating funding needs.
Permanent brain drain will be the norm
Second, the brain-drain of Greece, which is currently booming,
will worsen. The outflow of talented and well educated Greeks has
already started in 2010 when it was announced that Greece will seek
the contribution of the IMF and the EU mechanism (The Economist,
2012). Since then a great number of young Greeks has been leaving
the country on a daily basis. I anticipate that a possible Grexit
will significantly worsen this phenomenon and trigger even more
young people to seek employment abroad.
What would be even more problematic, I think, is that a possible
Greek exit will change the intentions of those who leave the
country. So far, young Greeks emigrate with the prospect of return
some time in the near future after the easing of macroeconomic and
fiscal austerity. If Greece exists the Eurozone, young Greeks will
anticipate a significantly lower degree of possibilities for
recovery in the medium to long-term, thus they will choose to stay
longer or even permanently abroad. This will have an added negative
effect on both Greek economy and society. It will be of similar
magnitude as the one created by the continuous harsh austerity and
could ultimately initiate a 'death spiral'.
Modernization or deadlock
Third and most important to me, a Greek exit from the euro will
mean the loss of an important opportunity for modernization of
Greek higher education and its long-awaited compliance with the
European Union policy and guidelines. For long, Greek higher
education has been subject to severe criticism for its lack of
accountability, low quality standards and programmes which fail to
recognise the needs of contemporary labour markets (OECD, 2011;
International Committee, 2010).
The "Memorandum of Understanding on Specific Economic Policy
Conditionality" which accompanied the bail-out loans by the Troika
included significant reforms for higher education. These reforms
along with the new legal framework introduced by the former
education minister Anna Diamantopoulou have yet to be implemented.
It is anticipated that an exit from the euro will mean a delay or
even the abandonment of these long-awaited reforms.
Overall, a possible Grexit will mean an immediate negative
financial impact and a medium to longer term policy/strategic
disorientation of Greek higher education coupled with devastating
consequences on brain-drain dynamics."