Greece could stumble
out of the euro by accident if a new government fails to reach an agreement
with international creditors soon after this month’s election, Finance Minister
Gikas Hardouvelis said.
The main challenge
facing whichever government emerges from the Jan. 25 vote will be to close the
stalled review of Greek progress in meeting the terms of its financial rescue
by the euro area and International Monetary Fund, he said. If that government
is led by Syriza, it would be “prudent” to reverse its stance and negotiate an
extension to the bailout before the aid supporting Greece expires on Feb. 28,
Hardouvelis said.
Opinion polls show the
opposition Syriza party of Alexis Tsipras with a slim though consistent lead
over Prime Minister Antonis Samaras’s New Democracy. Tsipras has said he’ll
roll back the austerity measures tied to the bailout and seek a write down on
some Greek debt, putting him on a collision course with the so-called troika of
creditors including the European Central Bank, which have kept the country
afloat with 240 billion euros ($284 billion) of loans pledged since 2010.
‘Breathing Space’
The outflow of bank
deposits in December, which were down about 3 billion euros, continued into the
start of January, though “everything’s under control,” Hardouvelis said.
The write-down Syriza
is seeking on Greece’s debts is politically unacceptable to its creditors, he
said. Instead, “breathing space” could come from further extending the duration
of the loans, and taking advantage of liquidity conditions by transforming
floating-rate loans to fixed rate, he said.
“Responsibility
transforms whoever runs the country, and I assume that rationality will
eventually prevail,” he said of the looming election in less than two weeks.
“The question is Greece doesn’t have much time.”
(Πηγή: bloomberg.com)
