Greece Debt Swap Completion Provides Relief But No Plan - Page 2
The answer lies in timing. When Greece received its first bailout of 130 billion Euros, the EU was buying time, proofing itself against a banking system meltdown and hoping its major markets would recover. That recovery has been slow coming, and the second bailout for Greece is intended to soften its default on payments and change the nature of its outstanding debts. Basically, while on paper it looks unlikely that the country will be able to meet any of its financial obligations in 2015 and beyond, a large portion of what it will owe then will be to the EU, rather than the private sector. The EU will be able to make re-adjustments and concessions, as appropriate, without a major risk of startling the markets and endangering the Union.
The question of where all this leaves Greece and its people is, however, still unanswered. Without a manufacturing sector and hardly any exports, Greece is a weak link in a chain which aims to get longer. Unless the EU takes measures to help it grow, it is quite possible that in less than five years’ time I will be revisiting this article and history will be repeating itself.