"The" 23 / 7
Andreas Petsini and George Pavlopoulos
The smiles and optimism returned to Athens after the first reaction of markets to "Covenant Salvation" of the Greek economy, the spread on ten-year bonds rolling down to approximately 1,200 units and the exchange of Athens to be ejected. The government believe that the markets today gave a clear vote of confidence in the decisions of the Summit.
The Maximus sends a clear message that reforms would continue and that no variations will be activated without delay procedures for the resumption of economic growth through both the NSRF and the new development package adopted by the Summit, and to accelerate privatization can attract large investments, both domestic and foreign. "Acquitted our people from the nightmare of bankruptcy (;) difficulties did not end but we can look to the future more optimistically," stressed George Papandreou told the Cabinet, describing the historical decisions of the Summit "17" eurozone. Giving the position of the policy will continue to pursue Mr. Papandreou appeared determined "democratically, but radically and decisively" to change the country not to return the next decades 'deadly threat of debt': It's time to commit to greater strength and safety in big changes for which society is thirsty. Give priority to creative Greece ", pointed features and sending a clear signal to members of government and citizens made it clear that what has been achieved by sacrificing his people in jeopardy of being lost if not pursued radical reform. In the same wavelength and the Minister of Finance: "He came bottom in the barrel of the Greek debt situation is sealed and stabilized," said Evang. Venizelos and he rushed to emphasize that the great relief resulting from the easing of the terms of repayment of debt should not mean relaxing.
Positive climate
The positive climate that formed in Greece in international markets, the Summit decision was reflected yesterday in relief in several ways. The one on the declarations made by the agency Reuters o General Counsel of the ISDA, namely the international body that decides whether or not the activation of the famous "risk premiums".
"This is clearly a voluntary exchange, and I do not see how this could trigger a credit event," said David Gin; thus embracing practically the positions presented in the evening Thursday, the ECB President Jean-Claude Trichet and clarifying the record that "bomb" of the CDS will not be triggered.
On the other broke the course (expected) move by Fitch. One of the three major rating agencies (not impossible, soon to follow and the other two) heralded the accession of Greece to a 'limited bankruptcy. " However, hastened to add that since then, and completed the exchange of old bonds with new, will go on (partial) upgrading of the country. "The Fitch believes that the nature of the involvement of the private sector (;) implies a small event of bankruptcy," said David Riley, head of sovereign debt rating of the house. He added, however, that: "The reduction in interest rates and the temporal extension of the maturity of loans in Greece offers a window, an opportunity to recover its solvency, despite the enormous challenges it faces."
Noteworthy is also the statement made by the head of the Private Banks in Germany (BDB): «I believe it is in our ability to manage," said Michael Kemer referring to the costs will have on members of the Association Agreement the Greek debt. Commenting on the decision of not meeting the Kemer found that "(the new package) the crisis is under control."
The challenge
from here on, however, certainly more than today, the stakes for the entire eurozone. Force, in other words, finding the American newspaper New York Times that "the expanded program on debt goes far beyond the borders of Greece." Practically, the markets will expect to see a comprehensive plan that promised to show soon Merkel and Sarkozy on economic governance in the Eurozone. Until then, of course, is very likely that they will try to bring Greece's position and the other two countries which are currently in ... Intensive: Ireland and Portugal. Moreover, despite assurances of Barroso, the van Rompuy and Trichet, the Fitch (like many others) consider the case of Greece is not "unique" ...
For its part, the president of Southwest saw positive and dark spots in the Summit decision. For Ant. Samara the decision of the Synod is "confession of failure" because, he said, "will constantly need new measures and new loan agreements." He argued that even if "improving credit conditions followed by selective default, can be dangerous, especially since there is absolutely no historical precedent."
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