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14 Aug 2015
Greece won't make it without a haircut – EU leaked paper
FXStreet (Mumbai) - A leaked EU paper on Thursday revealed that European Union openly expressed deep concerns about the sustainability of Greek debt, and admitting that the problem-laden country would eventually need a considerable haircut.
According to the study reported by WSJ, even if Greece implements the full bailout program, its debt is expected to remain at 159.7% of gross domestic product in 2022.
If Athens only partially implements the program, its debt would be at 173.7% of GDP at that time. And even if the country did better than estimated - mainly in the privatization arena - it would be still left with a debt mountain of 148.2% of GDP in 2022.
However, the paper didn't elaborate on what would happen to Greece’s debt if the government fails to implement the program.
The study was elaborated by the European Commission (EC), the European Central Bank (ECB) and the euro zone bailout fund.
According to the study reported by WSJ, even if Greece implements the full bailout program, its debt is expected to remain at 159.7% of gross domestic product in 2022.
If Athens only partially implements the program, its debt would be at 173.7% of GDP at that time. And even if the country did better than estimated - mainly in the privatization arena - it would be still left with a debt mountain of 148.2% of GDP in 2022.
However, the paper didn't elaborate on what would happen to Greece’s debt if the government fails to implement the program.
The study was elaborated by the European Commission (EC), the European Central Bank (ECB) and the euro zone bailout fund.