Friday, June 17, 2011

Quick Guide to the Greek crisis

Quick Guide to the Greek crisis

  A debt crisis in Europe's 17-nation single currency zone has entered a new and critical phase, with fears that Greece could default and spark a global financial disaster like that which followed the collapse of U.S. investment bank Lehman Brothers in 2008. [ID:nFLAGHE7OH]
Greek Prime Minister George Papandreou sacrificed his unpopular finance minister on Friday and gave the job to party rival Evangelos Venizelos, previously in charge of defence. [ID:nLDE75G0CY]
The leaders of France and Germany said they were united behind a new aid package for Greece in which banks that hold Greek debt would voluntarily shoulder some of the burden. [ID:nLDE75G0WW]

Greece has a sovereign debt pile of 340 billion euros ($481.5 billion), more than 30,000 euros per person in a population of 11.3 million. It has been rescued once already, accepting a 110 billion euro bailout last year from the European Union and International Monetary Fund. But that has proved insufficient and a second package worth 120 billion euros is now under discussion. Until future funding is agreed, at least in principle, doubt hangs over payment of the next 12 billion euro slice of the first package, which is due on June 29. With its debt equivalent to 150 percent of annual output, Greece holds two unwanted world records: the lowest credit rating for a sovereign state, and,read more.

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