Greece Crisis Talks & New Bail Out Package

March 6, 2012 - PRLog -- The countries of the eurozone reached an agreement to bail out Greece after more than 12 hours of talks.  This will save them from the potentially disastrous default on their loan payment next month.  

George Osborne, the Chancellor, said he hoped the agreement would boost the economy across Europe.  He went on to say "The rest of the eurozone has signalled a willingness to stand behind their currency and stand behind Greece, and frankly all along the failure to deal with the Greek situation has caused uncertainty.  Hopefully we can all move on now and get the European economy growing."

Jean-Claude Juncker, Luxembourg’s Prime Ministers and the chairman of the eurogroup of finance ministers, warned Greece that the bailout would require unpopular austerity measures.  He said “We expect the unprecedented solidarity of Greece's partners to be matched by a strong commitment by Greek leaders to fully implement their austerity programme”.

With worries that the bail-out could rise to 50 billion euros by the end of the decade and to prevent the collapse of the talks private investors and banks agreed to take longer maturities and lower interest rates on bonds, starting at 2% and rising to 4.3%.

Commenting on the crisis talks to prevent a debt default from Greece, Philip Booth, Professor of Insurance and Risk Management (http://www.cass.city.ac.uk/courses/masters) at Cass Business School says:

Even if Greece reaches agreement regarding its borrowing, it is highly likely to default beyond the agreements that have already been reached with creditors.

Greece's position inside the euro is both unstable, and destabilising for the eurozone more generally. EU governments are merely trying to put off the exit of Greece from the eurozone for which they are ill-prepared.

As such, the discussions regarding labour market reforms in Greece are less important for the eurozone and IMF than they are for Greece itself. If Greece is unable to reform its economy then, whether inside or outside the eurozone, the result will be stagnation and impoverishment for a generation.

Cass Business School offers the MSc in Insurance and Risk Management (http://www.cass.city.ac.uk/courses/masters/courses/insura...) which is a well-established Masters course that explores the multi-faceted world of risk management and reflects the growing interplay between insurance, risk management and financial services. As such, it will equip you with the all-round skills necessary to succeed in a constantly developing business environment.

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Cass Business School (http://www.cass.city.ac.uk/) is one of Europe’s leading providers of business and management education, consultancy and research.