Greece tries to soothe market with talks
By Aoife White |
April 19, 2010, Monday
|
Print Edition
Print Edition
GREECE'S finance minister said on Saturday that market worries over Greek bonds could calm when the country agrees more details on standby loans with European Union and International Monetary Fund officials after talks this week.
George Papaconstantinou told reporters that Greece has passed its "most difficult" month for refinancing its swelling debt by successfully selling some 12 billion euros (US$16 billion) of debt in April. It needs to sell more than 10 billion euros in May, he said.
He claimed that Greek government moves to reduce its budget gap and the provision of some 45 billion euros in bailout loans from the IMF and other countries that use the euro should now reassure investors.
He also sought to soothe fears that a bailout would be slow in coming, saying other eurozone countries told him that parliamentary approval would take "one week or two weeks at the maximum."
Spreads, or the difference between Greek and benchmark 10-year German bonds, soared last week, coming close to an all-time high, on news Germany would require a parliamentary vote, which can sometimes take months.
"Markets are pushing to see more detail and more specifics on the support mechanism," Papaconstantinou said, also blaming high interest rates on "people out there trying to make a buck" by betting on the chance that Greece could be unable to repay debt.
Some of that detail should come from talks due to start today when officials from the European Commission, the European Central Bank and the IMF are due to arrive in Athens to talk about the conditions for the loans and how they will be financed.
But the minister insisted that this was "not tantamount" to asking for a bailout.
George Papaconstantinou told reporters that Greece has passed its "most difficult" month for refinancing its swelling debt by successfully selling some 12 billion euros (US$16 billion) of debt in April. It needs to sell more than 10 billion euros in May, he said.
He claimed that Greek government moves to reduce its budget gap and the provision of some 45 billion euros in bailout loans from the IMF and other countries that use the euro should now reassure investors.
He also sought to soothe fears that a bailout would be slow in coming, saying other eurozone countries told him that parliamentary approval would take "one week or two weeks at the maximum."
Spreads, or the difference between Greek and benchmark 10-year German bonds, soared last week, coming close to an all-time high, on news Germany would require a parliamentary vote, which can sometimes take months.
"Markets are pushing to see more detail and more specifics on the support mechanism," Papaconstantinou said, also blaming high interest rates on "people out there trying to make a buck" by betting on the chance that Greece could be unable to repay debt.
Some of that detail should come from talks due to start today when officials from the European Commission, the European Central Bank and the IMF are due to arrive in Athens to talk about the conditions for the loans and how they will be financed.
But the minister insisted that this was "not tantamount" to asking for a bailout.
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