Austria, Netherlands, Slovakia seek collateral on loans to Greece | Pakistan Today

Austria, Netherlands, Slovakia seek collateral on loans to Greece

Austria, the Netherlands and Slovakia said they want collateral on loans to Greece after Finland secured a commitment, but a Greek official said this would nullify last month’s entire bailout deal. Although the three countries said on Thursday their positions were not new and echoed the view of some other euro zone states, signs of a new EU fracas over Greece’s plight brought incredulous comments from analysts.
“If you want to sell your pact to save Greece then you should not be fighting about this — it undermines the credibility of the package,” said Marco Valli, chief euro zone economist at UniCredit. The three latest countries to voice their demands and the Finns together account for around 11 percent of the euro zone contribution to the new 109 billion euro ($153.5 billion) Greek bailout. A senior Greek government official said Athens was not talking about such a collateral plan with countries other than Finland.
“We are not discussing this,” said the official who requested anonymity. “Entering such talks would cancel the entire bailout deal.” The Greek finance ministry declined to comment. New signs of discord will do nothing to encourage markets that euro zone politicians are getting on top of the debt crisis, after a blueprint from the leaders of Germany and France underwhelmed investors earlier this week.
“With more of Greece’s euro zone partners asking for collateral for their contribution to the second rescue package, the available pool of money becomes smaller, rendering the success of the second package more difficult,” said Theodore Krintas at Attica Bank in Greece. Athens and Helsinki agreed on a deal for collateral this week — proposing that Greece offers Finland a cash deposit to back loans made under the July 21 bailout deal. Finland has said the deposit plus interest would be comparable to the contribution it makes to Greece via Europe’s temporary bailout fund. Francois Cabau at Barclays Capital, said Finland’s insistence on collateral could threaten the bailout. “By agreeing to (collateral) … you actually do the opposite of what you originally set out to do, withdrawing cash from … somewhere that doesn’t have any,” he said. UniCredit’s Valli said: “We should not have so many voices when Europe really needs to be speaking with one voice, and this time the situation is even more disturbing because we are entering a period with lower growth and with the markets going crazy.” Euro zone financial experts were meeting on Thursday and Friday to discuss details of the bailout, including the issue of collateral for Finland, although the meeting was intended to iron out technical details rather than to take decisions, according to two euro zone sources. Austria’s Finance Ministry said its latest comments were in line with what euro zone leaders agreed in July. “If there is to be a model for collateral, Austria would also make a claim,” spokesman Harald Waiglein said.
BRUSSELS MUST ‘CRACK WHIP’:
The Netherlands took a similar stance. “Even if it was not a hard demand from parliament we, together with some other countries, have always indicated to Brussels and Finland that if Finland gets collateral our credit ranking position cannot worsen, and that we ourselves also want a collateral agreement,” a finance ministry spokesman said. A German official said the Finnish-Greek agreement “must be explained and discussed in the European sphere”. “There was an explicit carve-out agreed at the July 21 summit.
For them to now put their hand up and say we kind of wanted it (collateral) all along is unbelievable pandering to their domestic base,” said analyst Sassan Ghahramani at SGH Macro Advisers. “It must be frustrating, Brussels has to draw the line, crack the whip.” The July summit, which sought to prevent market instability spreading through the region, agreed to give Europe’s financial rescue fund new powers to help Greece.



Related posts

One Comment;

  1. Robert Flood said:

    MR ROBERT FLOOD
    HELLO IF YOU NEED LOAN TO PAY YOUR DEBT OR ANY OTHER PERSONAL NEEDS DON'T HESITATE TO COME TO US WE ARE FRIENDLY,FAST AND TRUSTWORTHY YOU CAN CONTACT US ON EMAIL [email protected] WE WILL BE HAPPY TO GET HONEST AND SERIOUS CLIENTS WHO WONT GIVE US PROBLEMS

    PLEASE PROVIDE THIS INFORMATION
    Full Name……….
    Personal Phone Number…….
    Country……….Address…… ….State……….Age…….. ..Gender……….Have
    you applied before……….
    Marital Status………
    Loan amount needed as loan……….
    Loan Duration……….
    Occupation ………
    Monthly Income……….
    BEST REGARD
    contact us
    [email protected]

Comments are closed.

Top