from Kleio's notebook: on Troikas, debts & Protecting Powers
'The insurgent Greeks had contracted loans, on disadvantageous terms, in the City of London during the war of independence and in 1832, the three Protecting Powers [that agreed to recognize Greek independence from the Ottoman Empire and selected a monarch to rule over the new nation, the 17-year old second son of Ludwig I of Bavaria], Britain, France and Russia, guaranteed a loan of 60 million francs, much of the proceeds of which were expended on the army, on King Otto's Bavarian bureaucracy and on the service of the loan.
'In the 1880s, further loans, totalling 630 million drachmas, were contracted, the service of which came to consume a third of the revenues of the state.
'When, in 1893, there was a collapse in world demand for her principal export, currants, Greece was forced greatly to reduce interest payments and was effectively bankrupt.
'Her economic condition was further weakened by defeat in the Greek-Turkish war of 1897, which resulted in the payment of a war indemnity of 4,000,000 Turkish pounds.
'The servicing of the loan raised to pay this indemnity and that of Greece's existing loans was placed in the hands of an International Financial Commission.
'This was based in Athens and consisted of representatives of the six "mediating" powers, Britain, Russia, Austria-Hungary, Germany, France and Italy.
'The repayment of these loans was to be assured by assignment of receipts from government monopolies, tobacco duties, stamp taxes and the customs duties levied in the port of Piraeus.
'The arrangement, virtually without precedent, amounted to a serious breach of Greece's financial sovereignty.'
Richard Clogg, A Concise History of Greece (Cambridge, 1992)