Dutch Raise Doubts Over Greek Debt Plan

Wall Street Journal
July 7, 2011

Dutch Finance Minister Jan Kees de Jager Thursday became the first euro-zone official to say publicly that a voluntary rollover of Greek debt isn't realistic and that he doesn't see much harm if the country is categorized as "in default" by rating agencies.

Euro-zone officials are at odds on how to keep Greece afloat and are scrambling to find ways to get private bondholders to contribute to a new aid package. Governments are under political pressure to limit the burden for taxpayers and they are calling on banks to participate in a deal to keep Greece solvent.

Mr. De Jager, an outspoken advocate of private-sector involvement, said Thursday it's unreasonable to expect a voluntarily participation and that some pressure on bond holders may be required. But rating agencies have warned that if any private-sector contribution isn't considered voluntary, this could be deemed as a default by Greece on its debt. Some observers fear that a Greek default may have a knock-on effect to other euro-zone countries struggling with their debt repayments.

But in a Dutch newspaper interview Thursday, Mr. De Jager played down these fears and said a default wouldn't necessarily result in a catastrophe.

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