News / Europe

Greece Sells Bonds to Avoid Default Friday

Public sector employees demonstrate in central Athens on November 13, 2012 against expected layoffsPublic sector employees demonstrate in central Athens on November 13, 2012 against expected layoffs
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Public sector employees demonstrate in central Athens on November 13, 2012 against expected layoffs
Public sector employees demonstrate in central Athens on November 13, 2012 against expected layoffs
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VOA News
Cash-strapped Greece has raised the money it needs to help it avoid a default later this week, but says it still urgently needs more bailout funds in the coming days.

The Athens government sold more than $5 billion in bonds Tuesday, which coupled with other cash will allow it to pay off more than $6 billion in financial obligations it owes on Friday.

Greece has adopted another round of austerity measures demanded by its international lenders in an effort to secure another $40 billion segment of its second bailout in the last two years.
 
Greek Finance Minister Yannis Stournaras warned the European Parliament that Greece has its financial limits and that if the new bailout money is not forthcoming soon there is a "very high" risk the country would default on future debt payments.

Finance ministers in the 17-nation euro currency bloc have yet to release the money, but French Finance Minister Pierre Moscovici says the funds could be disbursed to Greece by the end of November.

"The message we gave is a positive message to Greece.  Greece is making great efforts to respect its engagements. It adopted a package of reforms, as well as the budget for 2013.  All of that was voted on the 7th of November and on Sunday the Troika gave it a positive assessment.  It's a preliminary analysis that will have to be confirmed in the next few days, but we wanted to salute this effort," Moscovici said.

The finance ministers approved a plan to give Greece an extra two years - to 2016 - to cut its debt.  But the country's economy is in dire straits, with more than a quarter of its workers unemployed.  Greece is headed to a sixth year of recession in 2013.

European leaders say they want Greece to stay in the eurozone.  Economic analyst Robert Halver of the Baader Bank said the possibility of a Greek departure from the currency bloc has come - and gone.

"It is a political consideration to keep Greece in the eurozone, and if they would leave now - even if it would make economic sense - it would be harmful for certain politicians.  We also know that the euro crisis would then pick up again because it would almost be a joke to let the Greeks leave now.  It would have made a lot more sense to make that move two years ago before sacrificing all stability criteria," Halver said.

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