FXStreet (Edinburgh) – Analyst at ING Bank Peter Vanden Houte assessed the recently announced third Greek bailout.
Key Quotes
“It seems as if a deal on a third bail-out package (€86 bn over the next three years) between the Greek government and representatives from the IMF, the European Commission, the ECB and the ESM has been reached, although some outstanding issues remain”.
“The agreement foresees a primary deficit of 0.25% of GDP this year. In 2016 Greece should post a surplus of 0.5% of GDP, 1.75% in 2017 and 3.5% in 2018”.
“The good news is that Greece has given up its confrontational strategy and seems to be willing to collaborate with its creditors to avoid “Grexit”.
“However, the economic situation has strongly deteriorated over the last 8 months, making the fiscal consolidation still quite a challenge in a country that is tired of austerity”.
“And the complete structural overhaul of the Greek economy the creditors are imposing, seems a herculean task for a government that doesn’t necessarily share the ideological underpinnings of the requested measures”.
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