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28 August 2012

Kathimerini: Greece mulls T-bills to bridge extension funding gap


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Greece estimates that a two-year extension on its bailout would create a financing gap of less than €18 billion, which it could cover by issuing short-term debt rather than pleading for more money from lenders.


The argument is part of Greece's efforts to persuade irate European partners and the International Monetary Fund (IMF) that being granted more time to hit budget targets does not automatically mean forking out more money to save the country from bankruptcy. Greece believes the funding gap could be bridged by issuing T-bills, the official said, which Athens relied on to get past a funding crunch in August as it awaited its next tranche of aid.

Greek officials maintain that the country could get its €130 billion bailout programme back on track quicker if it is given a two-year extension on targets, which they say will let the economy rebound a year earlier than it would otherwise. "An extension will give us room to achieve higher rates of growth and employment”, Finance Minister Yannis Stournaras told parliament during question time. "We are seeking an extension in a way that will not take us off track with our goals."

Full article



© Kathimerini


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