Greek debt restructuring after all happened but is this the end?
Ralitsa Kovacheva, July 25, 2011
The forecast made by euinside, that there would be restructuring of the Greek debt after all, has come true. In February, we predicted that by autumn there would be real actions on the matter: “The idea of restructuring the Greek debt is no longer a taboo in the EU. Moreover, the necessary conditions for this to happen in the most painless way apparently are being prepared - the changes in the rescue fund for the euro area, the Pact for Competitiveness, the stress testing, the European framework for crisis management in the financial sector. From this perspective and given the need some uncomfortable truths finally to be addressed openly, it seems a realistic possibility debts to be counted in the autumn (after the proverb that sheep are being counted in the autumn).”
It turned out that our forecast came true sooner than expected, because of increased pressure of the financial markets on Greece itself, on the one hand, and on the other - on the EU to take decisive measures to address the debt crisis in the eurozone as a whole. Unfortunately, despite being in the right direction, the decisions of the euro area leaders, taken at their last summit, are unlikely to bring down the Greek debt to a sustainable level. So in this respect we can expect additional measures will be needed.
What are your predictions for the development of the situation? Share them as comments below this text.
Klaus Regling | © Council of the EU
Mario Centeno | © Council of the EU
Mario Centeno | © Council of the EU