Greece: Final warning for Athens

19 May 2011
Financial Times Deutschland, Financial Times Deutschland

, 19 May 2011

“Euro-rescuers divided over Greek cure,“ announces Financial Times Deutschland. The Hamburg daily reports on the European Central Bank, which has warned that a restructuring of Greece’s debt would have “catastrophic consequences.” According to FTD, in response to the soft restructuring plan currently under discussion by member states, ECB President Jean-Claude Trichet has insisted that the bank will no longer accept Greek bonds if loan maturities are extended.

In the Netherlands, De Volkskrant adds that on 18 May, the troika (ECB, IMF and European Commission) issued “a stern warning to Athens,” which has been given three weeks to revise its austerity plan if it wishes to receive the fifth tranche of the rescue loan (the final installment of 12 billion euros in the 110 billion euro package). Without this money, “Greece will be unable to pay its debts next month, and the payment of civil service salaries and pensions in the country will also be in jeopardy,” explains the daily.

The troika is concerned that Athens has been unable to reduce its budget deficit to the promised level of 7.6%. De Volkskrant is also critical of the Greek government, which has been “slow to tackle the problem of mass tax evasion.”