Brussels, 23/06/2016 (Agence Europe) - The creation of a buffer, respecting the economic adjustment plan and the highly accommodative monetary policy of the ECB are three factors which have greatly determined the return to the financial markets of eurozone countries that have been the subject of a three-year bailout plan financed by one of the eurozone's bailout funds.
A report published in June by the European Stability Mechanism (ESM), to which the debt management agencies of the eurozone countries under bailout plans (Ireland, Portugal, Spain and Cyprus) contributed, assesses the stages passed through by these countries on their road to being able to refinance their public debts on their own. The factors identified to reassure investors include: - the constitution of a “sizeable cash buffer” to reassure investors; - the “consistent and credible” implementation of the economic adjustment programme; - “the impact of low interest rates and the ECB's quantitative easing programme”.
The report also refers to a similar approach undertaken by the countries concerned to step up contacts with investors. This starts with a targeted communication strategy, the launch of opportunistic issuances and then the broader launch of issuance campaigns for bonds and securities.
Spain, which benefited from an ESM aid plan with an envelope of €41 billion to stabilise its banking sector, never lost access to the long-term debt market, unlike Ireland, Portugal and Cyprus. Greece, which has been cut off from the long-term debt markets since 2010, is under a third aid plan to run until 2018, which is the first to be financed by the ESM (see other article). (Original version in French by Mathieu Bion)