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Greece΄s Deficit Revised At 10.5% Of GDP
Eurostat announced on Tuesday that the deficit of the General Government for 2010, is estimated at €24.2b (10.5% of Gross Domestic Product), while the gross consolidated General Government debt at year-end 2010 is estimated at a nominal value of €328.6b (142.8% of GDP), according to provisional data.
It is expected to increase the adjustment measures by around €2.5b.
The above should be added to the projected deviations of 2011, which are expected to exceed €4-4.5b, according to a “middle-course” scenario.
This image will get a certain size and content in the May, when the troika officials arrive.
According to European Union officials, there are growing discussions regarding how Europe should deal with a possible Greek program’s failure to bring back the country in the markets next year.
European Central Bank consider risky that Greece’s example of implementation of the Memorandum of Understanding will shape the expectations of markets regarding countries, which will join the program, such as Portugal. It would be very critical for neighbouring Spain because of its major economic ties with Portugal.
Capital.gr sources noted that Eurozone’s attention will be turned back to Greece during the European Summit in June with a double objective:
• The formation of political conditions to convince markets that the Memorandum may have effects in Greece. The yields of three-year and two-year bonds have reached unprecedented highs (20-21%), prejudging the failure of the program and the restructuring of Greek debt.
• The preparation of alternatives in 2012, when both Greece and Ireland will require additional funds to cover gaps and avoid declaring default just a year ahead of the establishment of European Stability Mechanism.
In this context, it appears that “corrections” in the temporary mechanism (EFSF) are likely in June, provided that there is an improvement of conditions for a political consensus in Greece and Portugal, in order to prevent the outbreak of a new round of crisis before 2013.
Eurostat also revised Greece΄s 2008 budget deficit to 9.8% of GDP from 9.4%.
(capital.gr)
Eurostat announced on Tuesday that the deficit of the General Government for 2010, is estimated at €24.2b (10.5% of Gross Domestic Product), while the gross consolidated General Government debt at year-end 2010 is estimated at a nominal value of €328.6b (142.8% of GDP), according to provisional data.
It is expected to increase the adjustment measures by around €2.5b.
The above should be added to the projected deviations of 2011, which are expected to exceed €4-4.5b, according to a “middle-course” scenario.
This image will get a certain size and content in the May, when the troika officials arrive.
According to European Union officials, there are growing discussions regarding how Europe should deal with a possible Greek program’s failure to bring back the country in the markets next year.
European Central Bank consider risky that Greece’s example of implementation of the Memorandum of Understanding will shape the expectations of markets regarding countries, which will join the program, such as Portugal. It would be very critical for neighbouring Spain because of its major economic ties with Portugal.
Capital.gr sources noted that Eurozone’s attention will be turned back to Greece during the European Summit in June with a double objective:
• The formation of political conditions to convince markets that the Memorandum may have effects in Greece. The yields of three-year and two-year bonds have reached unprecedented highs (20-21%), prejudging the failure of the program and the restructuring of Greek debt.
• The preparation of alternatives in 2012, when both Greece and Ireland will require additional funds to cover gaps and avoid declaring default just a year ahead of the establishment of European Stability Mechanism.
In this context, it appears that “corrections” in the temporary mechanism (EFSF) are likely in June, provided that there is an improvement of conditions for a political consensus in Greece and Portugal, in order to prevent the outbreak of a new round of crisis before 2013.
Eurostat also revised Greece΄s 2008 budget deficit to 9.8% of GDP from 9.4%.
(capital.gr)
