ISSN 2330-717X

Greece: Living On The Edge – OpEd


By Roman Mamonov

Greece is on the verge of quitting the eurozone as it has failed to reduce its public debt to 120% of the GDP by 2020. This fiscal liability was put forward by the three loan-givers: the EU, the ECB and the IMF.

EU politicians keep saying that the “horror” of Greece’s exit has faded which means that the EU is ready to see Greece leave.
European stock markets were in the red this morning driven by Spanish financial troubles and a possible Greek exit from the euro. Spain’s Valencia and Catalonia want to ask for more loans, while the country’s Central Bank reported that Spain’s GDP shrank by 1% in the second quarter of 2012.


Greece, on its part, appeared to be the main troublemaker. This Tuesday, auditors from the three helpers will come to Athens for an inspection. Greece is failing to reduce spending due to a political crisis and mass protests but needs extra 50 bln euros. Creditors are rather reluctant about giving Greece the money.

German economy minister Philipp Rösler said that if Greece doesn’t fulfill the troika conditions, there can be no more payments.

“I visited Greece with a group of businessmen and saw it myself that Greece will probably not be able to fulfill its liabilities. Thus, then there can be no more payments. This means that Greece will loose its solvency and Greeks agree that it maybe would be wiser to quit the eurozone. Experts think the same and for me a Greek exit from the eurozone has long since lost its horror.”

The ECB has toughened its stance on Greece and refused to take its bonds as a payback guarantee which means no cheap loans for Greece.

Analyst from the Capital Finance Group Alexei Vyazovskoy believes that this can pave the way to Greece’s exit.

“It would be better if the eurozone had a comprehensive leave mechanism for financial troublemakers. This could be a shock for the markets, especially the interbank lending market but the ECB can handle it. A horrible ending is better than endless horror.”

Athens were to get fresh loans in September but experts believe that September can be the last month of Greece in the eurozone.

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VOR, or the Voice of Russia, was the Russian government's international radio broadcasting service from 1993 until 2014, when it was reorganised as Radio Sputnik.

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