Why Greece's debt continued to rise since 2010

At the end of 2009, as Greek bondholders were beginning to worry about a possible debt crisis, Greece's central government debt stood at about 300 billion euros, roughly 130 percent of gross domestic product. Its fiscal deficit for the same year had been over 15 percent of GDP. A few months later, Greece lost market access and entered an adjustment program, financed by the European Union and the International Monetary Fund (IMF), aimed at gradually eliminating its deficit and restoring the sustainability of Greece's public debts.

By 2016, Greece had achieved a small fiscal surplus. But its central government debt continued to rise - by about 10 percent in nominal terms, and much more dramatically as a share of GDP, before stabilizing at around 180 percent of GDP. This happened despite three successive economic adjustment and reform programs and several rounds of debt relief -...