GREECE URGED TO USE GERMAN MODEL FOR SELLING ASSETS
LUXEMBOURG Prime Minister Jean-Claude Juncker has called on Greece to set up an agency to privatise state assets along the lines of the German institution that sold off East German enterprises in the 1990s.
“I would very much welcome it if our Greek friends would set up a state privatization agency after the model of the German Treu-handanstalt”,Mr Juncker said in an interview with Germany’s Der Spiegel magazine which is set to run on Monday.
Mr Juncker, who is also chairman of the Eurogroup forum of euro-zone finance ministers, said such an agency should include foreign experts among its staff.
“The European Union will accompany the privatization program as closely as if it were carrying it out itself”, Mr Juncker told the magazine, adding that Greece could gain more from privatization than the 50 billion euro it has estimated.
Mr Juncker said a so-called soft restructuring by extending the maturities of Greek debt could only be considered once Greece had consolidated its budget.
“Then we can consider to extend the maturities of public and private loans, and lower interest rates”, he is quoted as saying.
Mr Juncker also called on Greece’s two biggest political parties to end their bickering.
“The government and the opposition should declare jointly that they commit to the reform agreements with the European Union”, Mr Juncker said.
Meanwhile, French Finance Minister Christene Lagarde signaled that Paris might support a rescheduling of Greek debt, warning Greece was at risk of default if it didn’t do more to bring its public finance into order.
The comments mark a shift in France’s position in a debate that has pitted Germany and other euro-zone governments against the European Central Bank, which opposes any form of restructuring of Greek debt.
French support for proposals of a soft restructuring would leave the ECB isolated in its opposition.
Germany and other euro-area states have warmed to the idea of extending maturities – which is technically considered a default – given the size of Greece’s debt burden and its bleak economic prospects.
France had sided with the ECB in opposing restructuring, but Ms Lagarde’s comments suggest Paris is softening its stance.
The stand-off between the ECB and euro-area governments reflects how intractable the Greek crisis has become. A year after extending Athens a bailout, it has become clear the 110 bn Greece was promised by its euro-zone neighbours and the International Monetary Fund won’t be enough to solve its financial crisis.
Europe must now decide whether and how to keep Greece from defaulting.
The ECB worries that a restructuring, in any form, would do irreparable damage to the euro-zone’s reputation with investors. Germany and euro-area states, in turn, are concerned about the political cost of continuing to support Greece without forcing Athens and its creditors to make concessions.
The central bank kept up its insistence on Friday that even a soft restructuring was not acceptable and again threatened to withhold funding for Greek banks, with the warning this time coming from the newly installed head of Germany’s central bank.
Changing Greek bond maturities “cannot substitute for fulfilling the adjustment program”, undertaken by Greece, Bunddesbank president Jens Weidmann said. A reprofiling in the current market environment “would make it impossible to accept them as collateral for refinancing operations under the existing rules of the Eurosystem’s collateral framework, and consequently large parts of the Greek financial sector would be cut off from funding”, he said.
THE POLITICAL PARTIES OF GREECE ARE TOTALLY RESPONSIBLE FOR THE LOSS OF HELLENIC ECONOMIC SOVEREIGNTY and INDEPENDENCE.
THEIR TOTAL IRRESPONSIBITY IN GOVERNMENT & OPPOSITION in the last 35 to 40 years has brought the country to its knees and destroyed the lives of its people.
So what does the Hellenic Republic need ? Does it need a new philosophical political order? Does it need to rid itself of these corrupt politicians and failed political parties? Do the Hellenic people need a new Parliamentary Order to replace the old, so as to bring about much needed renewal and hope?
LUXEMBOURG Prime Minister Jean-Claude Juncker has called on Greece to set up an agency to privatise state assets along the lines of the German institution that sold off East German enterprises in the 1990s.
“I would very much welcome it if our Greek friends would set up a state privatization agency after the model of the German Treu-handanstalt”,Mr Juncker said in an interview with Germany’s Der Spiegel magazine which is set to run on Monday.
Mr Juncker, who is also chairman of the Eurogroup forum of euro-zone finance ministers, said such an agency should include foreign experts among its staff.
“The European Union will accompany the privatization program as closely as if it were carrying it out itself”, Mr Juncker told the magazine, adding that Greece could gain more from privatization than the 50 billion euro it has estimated.
Mr Juncker said a so-called soft restructuring by extending the maturities of Greek debt could only be considered once Greece had consolidated its budget.
“Then we can consider to extend the maturities of public and private loans, and lower interest rates”, he is quoted as saying.
Mr Juncker also called on Greece’s two biggest political parties to end their bickering.
“The government and the opposition should declare jointly that they commit to the reform agreements with the European Union”, Mr Juncker said.
Meanwhile, French Finance Minister Christene Lagarde signaled that Paris might support a rescheduling of Greek debt, warning Greece was at risk of default if it didn’t do more to bring its public finance into order.
The comments mark a shift in France’s position in a debate that has pitted Germany and other euro-zone governments against the European Central Bank, which opposes any form of restructuring of Greek debt.
French support for proposals of a soft restructuring would leave the ECB isolated in its opposition.
Germany and other euro-area states have warmed to the idea of extending maturities – which is technically considered a default – given the size of Greece’s debt burden and its bleak economic prospects.
France had sided with the ECB in opposing restructuring, but Ms Lagarde’s comments suggest Paris is softening its stance.
The stand-off between the ECB and euro-area governments reflects how intractable the Greek crisis has become. A year after extending Athens a bailout, it has become clear the 110 bn Greece was promised by its euro-zone neighbours and the International Monetary Fund won’t be enough to solve its financial crisis.
Europe must now decide whether and how to keep Greece from defaulting.
The ECB worries that a restructuring, in any form, would do irreparable damage to the euro-zone’s reputation with investors. Germany and euro-area states, in turn, are concerned about the political cost of continuing to support Greece without forcing Athens and its creditors to make concessions.
The central bank kept up its insistence on Friday that even a soft restructuring was not acceptable and again threatened to withhold funding for Greek banks, with the warning this time coming from the newly installed head of Germany’s central bank.
Changing Greek bond maturities “cannot substitute for fulfilling the adjustment program”, undertaken by Greece, Bunddesbank president Jens Weidmann said. A reprofiling in the current market environment “would make it impossible to accept them as collateral for refinancing operations under the existing rules of the Eurosystem’s collateral framework, and consequently large parts of the Greek financial sector would be cut off from funding”, he said.
THE POLITICAL PARTIES OF GREECE ARE TOTALLY RESPONSIBLE FOR THE LOSS OF HELLENIC ECONOMIC SOVEREIGNTY and INDEPENDENCE.
THEIR TOTAL IRRESPONSIBITY IN GOVERNMENT & OPPOSITION in the last 35 to 40 years has brought the country to its knees and destroyed the lives of its people.
So what does the Hellenic Republic need ? Does it need a new philosophical political order? Does it need to rid itself of these corrupt politicians and failed political parties? Do the Hellenic people need a new Parliamentary Order to replace the old, so as to bring about much needed renewal and hope?
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