Emergence and Development of the Government Debt Crisis in the European Monetary Union

The reasons, development and the effects of the crisis on the government debts in the European Monetary Union are analyzed in this article. The conclusion is justified, that a single currency for diverse economies does not result in economic convergence, but on the contrary – economic divergence. The macroeconomic criteria for a nominal convergence, that must be met by each applicant country for EMU, do not necessarily open the way to a real convergence. The development of the crisis-related processes in the Eurozone is focussed, starting from Greece. Later Ireland and Portugal have also been affected by the financial contamination. The conditions for the rescue packages, granted officially to the three countries are examined. The increased costs for market financing of the government debts concerns Italy and Spain. The effects for Bulgaria from the government debt crisis in the Eurozone could be considered controversial.