February 4, 2012
Greece may breathe a sigh of relief when—or if—it finally completes its long-delayed debt restructuring next week.
But the plodding negotiations have been bad news for another country: Portugal, whose creditors fear they may be force-fed the same difficult debt restructuring terms that are on the table for the Greeks.
The Greece deal still isn't done, and Friday there were more signs of delay. Greek Finance Minister Evangelos Venizelos said the two sides had "resolved a number of issues but critical issues remain open." Euro-zone finance ministers postponed a planned Monday meeting till Wednesday, Mr. Venizelos said.
Portugal has long been perceived as the next-most-likely country to follow Greece's path and restructure its debt, and the tough terms being presented to Greece's creditors have led many in the market to fear the same could come for Portugal, analysts say.
Perhaps most worrisome to those who have lent to Portugal is the notion that Greece may pass a law that would force a reluctant minority of bondholders opposed to the restructuring to participate nonetheless.
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