Brussels, 28/05/2013 (Agence Europe) - “We need deep solutions and immediate solutions”, the president of the Greek chambers of commerce and chair of the Athens chamber of commerce, Constantine Michalos, told EUROPE on Thursday 23 May 2013 at a conference on business opportunities and prospects in Greece.
Earlier this month, the Greek finance minister, Yannis Stournaras, said in an interview with this newsletter that he would be satisfied with a reduction in the interest rate on the loans to Greece (see EUROPE 10847). Michalos said a reduction in interest rates would not be enough: “By reducing interest rates, you're talking about a two to five years period in order to begin to see any benefits.”
He said a more radical solution is needed and the only credible option is for institutional lenders, the official sector involvement or OSI, to write off some of Greece's debt. “The only way to begin to move out of the crisis and to begin to address capital market, is to reduce the debt by €50 billion so that we can bring the debt to GDP ratio under 120%,” said Michalos.
The Greek authorities hope to be able to return to the money markets unaided shortly - the country is currently unable to roll over its debt because the yields demanded are too high.
For the Eurozone there would also be a symbolic reason for writing off some of Greece's debt. Michalos says: “The Greek private sector has suffered already, Greek pensions have suffered and Greek workers have suffered, all classes have suffered in one way or another. If we really believe in European cohesion, this is the right time and the right way to prove it.”
The Greek government is therefore right to want to continue and deepen its efforts and exceed its budget targets, said Michalos, noting that if, rather than reaching a primary surplus and balance rapidly, Greece was to achieve a surplus, then “it would make the negotiations much easier.” He feels that writing off some of the Greek debt would be possible after the German elections in September.
Michalos says that the all the indicators show that Greece is on the road to recovery and the efforts made will make it possible to permanently shake off the uncertainty surrounding the country's future. (EL/transl.fl)