Forget about preventing default in Greece, control it, says Europe

Christian Science Monitor
February 17, 2012

Greece’s European partners are increasingly skeptical that Athens can avoid default. The highly indebted country is working feverishly to secure a debt write-off to avoid default, but international investors see even that as a default of sorts.

With only weeks to go before a crucial bond repayment date, statements from European leaders reveal a growing mistrust in the Greek political class's ability and willingness to implement deficit cutting measures. Without those measures, Greece will not receive a necessary second bailout from international lenders, and without the bailout, it will likely default when its debt comes due in March.

According to some analysts, Europe is readying for a Greek bankruptcy.

“Some of the core economies in the eurozone are taking a much tougher stance on Greece now and seem to be prepared to allow it to default,” says Ben May, European economist at the London-based research consultancy Capital Economics. “Add to that the number of stumbling blocks remaining and there is a real chance Greece could default in March.”

More