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Journalism of Courage
Debt swap saves Greece from an immediate default,but offers little else
Greece,in these tragic times,has done a first again. The Greek government has received enough investor support to implement the largest restructuring of government debt in history. Holders of almost 86 per cent of debt under Greek law and 69 per cent of international debt holders gave the go-ahead to a debt swap,which will bring home the 130 billion euros in the latest bailout package from the EU and IMF. While investors are set to lose around 74 per cent of their investment,the alternative is a likely sovereign default,leaving nothing for them to salvage. Nevertheless,this is nothing more than a temporary reprieve,saving Greece from an immediate default.
Greece goes for polls in April,and the government hated for this prolonged pain is likely to be voted out. But the alternative to this economic hardship and socio-political upheaval is for Greece to leave the euro and face disaster. This tragedy is not of Greek origin,and the EU powerhouses have a lot to answer for. But a global economy on the brink has been hoping Europe wouldnt come unravelled in Greece,where it all began so long ago.
