From 1996 - 2008, the Greek economy expanded faster than the broader European Union in each and every year (below is all the data I could dig up for a chart).
But, growth is a good thing right?
In most cases... sure, but all growth is not the same. Growth based on ever-expanding debt (think housing bubble) is surely not as good as one based on increased productivity. While there is no doubt that a lot of Greece's growth was due to increased productivity that came with being a member of the EU (i.e. open markets), a lot of this growth came from cheap financing which not only allowed the Greek economy to double within a 10 year period, but to double their debt levels as well.
This arrangement of growth and ever-increasing debt was all good... until it wasn't.
When the Greek economy turned south during the crisis, debt to GDP levels spiked as debt continued to grow, but the underlying economy didn't. When banks realized they all owned a boatload of this debt (as well as debt of other periphery nations in similar situations as Greece), they shunned further purchases.
Why? It turned out that the Greek economy that only grew in one direction (and faster than Europe as a whole), was loaded with debt and wasn't actually growing.
Source: Haver
