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10 Feb 2015
Greece crisis: Basis for an agreement exists – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team shares the probable proposition by Greece to come at an agreement with its lenders, further adding that in spite of Greece seeming like negotiating with itself, there still exists a possibility of an agreement.
Key Quotes
“The broad outlines of Greece's new proposals include accepting around 70% of the existing arrangement and possibly tapping part of the 7 bln euro tranche that Athens has been refusing. The new Greek government will propose new reforms and wants to draw on the expertise of the OECD.”
“According to some reports, Greece is also proposing the transition period (bridge loan) extends through August rather than May.”
“Greece also wants European creditors to forgo nearly 2 bln euros in profits earned on Greek debt and re-purpose 11 bln euros for bank recapitalization to help address the non-performing loans. It also is pushing for a smaller primary budget surplus target.”
“That said, the official creditors do not appear to have softened their position one iota. This seems to be the third iteration of the new proposals from the new Greek government. It is almost negotiating with itself.”
“Still the basis for an agreement exists. It most certainly will not be a meeting in the middle.”
“Rather, something like 80-85% of the existing framework will likely be retained and some modest concessions, like the smaller primary budget surplus and easier terms on existing debt in exchange for new reforms.”
“Syriza is more likely to implement the reforms to curb tax evasion and rent-seeking behavior than previous governments.“
Key Quotes
“The broad outlines of Greece's new proposals include accepting around 70% of the existing arrangement and possibly tapping part of the 7 bln euro tranche that Athens has been refusing. The new Greek government will propose new reforms and wants to draw on the expertise of the OECD.”
“According to some reports, Greece is also proposing the transition period (bridge loan) extends through August rather than May.”
“Greece also wants European creditors to forgo nearly 2 bln euros in profits earned on Greek debt and re-purpose 11 bln euros for bank recapitalization to help address the non-performing loans. It also is pushing for a smaller primary budget surplus target.”
“That said, the official creditors do not appear to have softened their position one iota. This seems to be the third iteration of the new proposals from the new Greek government. It is almost negotiating with itself.”
“Still the basis for an agreement exists. It most certainly will not be a meeting in the middle.”
“Rather, something like 80-85% of the existing framework will likely be retained and some modest concessions, like the smaller primary budget surplus and easier terms on existing debt in exchange for new reforms.”
“Syriza is more likely to implement the reforms to curb tax evasion and rent-seeking behavior than previous governments.“