Daily View: What Greece's debt could mean for Europe
Commentators ask what is next for the euro and Greece. It follows eurozone finance ministers' decision to postpone a judgement on loans to Greece until their parliament passes new austerity measures.
politicians bothered meeting up for seven hours only to come out without a decision. But it says there was some movement:
"The only obvious progress tonight was that Germany has formally abandoned its demand that existing bonds be swapped for new ones with a seven-year maturity. Instead, the ministers agreed that private creditors would be asked only for 'informal and voluntary roll-overs of existing Greek debt at maturity...while avoiding a selective default for Greece.' The only stipulation is that the resulting contribution be 'substantial' - a weaker formulation than the original German wish for a contribution that is 'substantial, quantifiable, reliable and voluntary'.
Ìý
"One must assume that the sums that can be raised for the rescue package will now be more modest, which raises the question of whether the prevarication is really worth the turmoil it is causing."
if there was something other than indecisiveness behind postponing the decision:
"The euro group's decision to postpone a decision might be clever from a tactical point of view. But whether it will impress the financial markets is another matter. Investors, who value transparency and predictability, are unlikely to be reassured by the euro-zone governments' desire to put off dealing with the problem."
the ramifications Greece's crisis will have for the rest of the eurozone:
"The great fear among eurozone governments and at the European Central Bank is that a debt default by Greece could undermine bond markets' trust in other cash-strapped euro members. Ireland and Portugal are already struggling to rebuild investors' confidence, despite rescue loans from the European Union and International Monetary Fund. If panicked investors flee from Spain, a $1.6 trillion economy, the country could prove too big to save."
The director of the think tank Centre for European Reform, if Greece's departure from the euro would be the beginning of the end for the currency:
"The financial markets would smell blood. Portugal could only avoid contagion by adopting bold reforms swiftly. The EU would have to give it huge economic and political support. Ireland, with a flexible economy and successful export industries, should be able to stay in, so long as it scraps the foolish guarantee given to those who bought bank bonds."
that if Greece left the euro the country wouldn't be any worse off:
"Look at what happened to us after we left the ERM, or to the Latin American economies who abandoned the dollar peg. In both cases, it was the route to cutting interest rates and export-led recovery.
Ìý
"The euro has exacerbated the financial crisis by encouraging some countries to behave as recklessly as the banks themselves. We are supposedly engaging in this bail-out system to protect the banks, including our own. But as long as there is the fear of default, as long as the uncertainty continues, confidence will not return across the whole of Europe - and that is bad for the UK and everyone else."
