July 11, 2011
With no consensus on how to share the burden of a new Greek bailout with the troubled country's private-sector creditors, European finance ministers struggled at a meeting Monday to make progress on a fresh aid package.
Arriving in Brussels, officials offered widely divergent views on how to proceed. The Dutch finance minister said burden-sharing by private-sector creditors was a precondition to fresh aid; the Spanish finance minister warned of "instability in the markets" and said the Continent ought to think first of preventing the crisis from spreading beyond Greece, Ireland and Portugal.
At the heart of the issue: Credit-rating companies have made clear that any significant effort to make private creditors feel pain would be treated as a debt default by Greece. Most top officials—chief among them European Central Bank President Jean-Claude Trichet—have said letting that happen is unacceptable.
That leaves Europe with a stark choice: Either make European taxpayers responsible for funding Greece indefinitely, or shift some of the burden to private creditors and suffer a debt default.
More
No comments:
Post a Comment