Greece depends
entirely on international support and its creditors are not too impressed.
Mario Draghi, the European Central Bank's president, revealed Thursday that its
loans to Greece had more than doubled over the last month or two -- to about
€100 billion. That's the equivalent of 68% of Greek GDP, the worst ratio in the
eurozone.
In return, the
anti-austerity government in Athens pledged to pay its debts on time and in
full, and to craft reforms acceptable to its creditors by the end of April.
But there has been
little sign of progress on the reforms. Finance Minister Yanis Varoufakis has
vowed to continue fighting austerity that he believed caused the Greek economic
crisis.
Draghi said Greece has
to stick with the reform program if it wants to be able to access European
money in the future.
Meanwhile, there have
been reports that the government may not have enough money to repay more than 6
billion euros in short-term debt and IMF loans due in March.
Draghi made it clear
the ECB will not dodge its own rules and raise Greece's limit on short-term
debt issuance, so the government will have to come up with an alternate source
of financing.
And earlier this week,
Spain publicly raised the prospect of Greece needing a third bailout once the
existing lifeline expires in June.
The bottom line: The
crisis could flare up again. Europe is better equipped than it was in 2012 to
prevent a Greek default from triggering a wider crisis, but it would still deal
a heavy blow to confidence.
(Πηγή: money.cnn.com)
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