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Merkel to join crisis talks on Greek vote threat

The Local · 1 Nov 2011, 16:12

Published: 01 Nov 2011 10:14 GMT+01:00
Updated: 01 Nov 2011 16:12 GMT+01:00

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"The chancellor and the French president have agreed to hold a round of talks on Wednesday, November 2 in Cannes with the European institutions and the IMF as well as a meeting with the Greek side," the statement said Tuesday.

The emergency meeting was arranged during a phone call between President Nicolas Sarkozy and Chancellor Angela Merkel to discuss Greece's call for a referendum on a euro debt rescue package agreed at an EU summit last week.

"France and Germany are determined to ensure with their European partners the full implementation, as quickly as possible, of decisions taken by the summit, which today are more necessary than ever," the statement said. "France and Germany are convinced that this agreement will allow Greece to return to sustainable growth."

Sarkozy is to hold a summit of the Group of 20 industrialised nations in the Mediterranean city of Cannes on Thursday and Friday.

Earlier on Tuesday, Rainer Brüderle, a leading member of Merkel’s centre-right coalition, said Europe should prepare for Greece to go bust after the country announced its intention to hold a referendum on the unpopular bailout package.

“If Greece says ‘No’ to combating its structural weaknesses, becoming more competitive, and to reform, then in my opinion it will go bankrupt,” the parliamentary group leader of the pro-business Free Democrats told public broadcaster Deutschlandfunk.

Brüderle said Greek Prime Minister George Papandreou’s decision on Monday to call for a confidence vote and a referendum on last week's EU debt deal was a “strange course of action” in light of the potentially disastrous outcome.

“The country was poorly governed for decades and its government made a wrong decision that manoeuvred it into this crisis,” he said.

But Papandreou on Monday appeared willing to take a political gamble to silence growing opposition to his policies.

The Socialist premier, who has 153 deputies in the 300-seat parliament, has faced increasing dissent within his own party over the tougher austerity policy monitored by the EU and the International Monetary Fund that has sparked general strikes and widespread protests, many of them violent.

"The command of the Greek people will bind us," Papandreou said. "Do they want to adopt the new deal, or reject it? If the Greek people do not want it, it will not be adopted."

The confidence vote is expected to be held on Friday while the referendum is slated for early next year.

An adverse result in either process would scupper the EU deal, which is designed to cut Greece's debt load of over €350 billion ($495 billion) by around €100 billion. It was only reached after months of haggling in marathon talks last Thursday and besides the Greek debt reduction included measures to bolster the European banking system, help other struggling eurozone member states and boost the size of the bloc's bailout funds.

Story continues below…

The German Finance Ministry, which along with France had hammered out the EU deal, declined to comment on the announcement, with a spokesman in Berlin calling it "an internal political development in Greece on which the government does not yet have any official information."

In a survey in To Vima weekly on Sunday, over 58 percent of Greeks termed the deal 'negative' or 'probably negative', although over 72 percent of those polled said Greece should remain in the euro.

Papandreou's gambit came as Greece faced delicate negotiations with its eurozone peers on the details of last week's agreement and with global bankers asked to accept a 50-percent loss on their Greek debt holdings.

AFP/DAPD/The Local/mry

The Local (news@thelocal.de)

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Your comments about this article

10:56 November 1, 2011 by melbournite
What, a referendum ?!? Democracy for the Greek people ?!? A government that does what the people who elected them wants, rather than what big banks tell them to do ?!?

Don't you know that capitalism and real democracy are mortal enemies?
13:46 November 1, 2011 by Lachner
I honestly don't understand Greece. They all got themselves into this situation by not paying their taxes, electing the wrong politicians, allowing corruption and by spending and living way beyond their means as a nation and on a personal level. Now they are on the verge of bankruptcy as a nation and they want to reject a deal that would slice their debt by 100€ Billion, their banks would receive the backing from the EU and they have a bail-out fund in case things turn south again. What is wrong with that? Every Greek that I have spoken with tells me that they want to leave the EU and go back to the Drachma. Ok fine, but how are you going to pay the debts to the banks in Greece, Europe and the US? They may leave the EU and adopt again their own currency again if they want, but they still have to pay their debts and they honestly cannot do that. Therefore, I don't understand what they really want and I am getting tired of their BS.
14:21 November 1, 2011 by murka
I don't see how Mr. Brüderle's opinion could be interesting to anyone.

The decision whether to subscribe to the conditions or to declare a bankruptcy will shape the life of Greeks for the generations to come.

If they decide for bankruptcy this is the best moment to do so.
14:52 November 1, 2011 by venkyfra
@murka, True this is the best moment to declare bankrupt and restructure the country.

Greece is a democracy and they have every right to do what they want.

Everyone knows that Greece can never ever pay the debt. Not even 1/100th of it.

So its better for them if they go bankrupt.

Still better if they say they are a new country now, like change the symbol or name, introduce a new currency etc.. by doing that they can argue to throw away all the old debt.

Money is virtual. Everything is possible in this world...
16:57 November 1, 2011 by derExDeutsche

'Every Greek that I have spoken with tells me that they want to leave the EU and go back to the Drachma. Ok fine, but how are you going to pay the debts to the banks in Greece, Europe and the US? '

No, they want to go bankrupt. After which, they want to start taking on new debt, so their Govt. can continue paying Pensions.They want pensions paid at ANY COST.

Once they are bankrupt, they don't owe anybody anything, they are bankrupt.


'Don't you know that capitalism and real democracy are mortal enemies?'

Are you even on the same planet?
17:07 November 1, 2011 by finanzdoktor
Question(s): Why is Greece waiting until next year to vote on the referendum? Why not do it within 30 days? Why wait until the latest tranche in funds runs out to then vote on it? Why are they keeping the rest of the world on the hook with uncertainity?

I know, too many "Why?" questions. But, when you stop to think about, it appears the Greeks don't care, just want to have their cake and eat it too, as they have since joining the Euro monetary union.
17:18 November 1, 2011 by gounis

Of course you dont understand Greece because you probably dont live there... Dont make dangerous generalizations like all Greeks dont pay their taxes. You must always investigate every phenomenon to the appopriate context. Many Greeks dont pay taxes because they are corrupted, many Greeks dont pay taxes because they have already payed the corrupted tax collectors who blackmail medium class buisnessman and many greeks may not pay taxes because most probably the taxes will end up to some big villas for politicians or they will be used to satisfy some people in order for the government to stay in power.

Also, it is not true that all Greeks want to return to drachma. The last survey made by Kappa Research showed that 72,5% of Greeks want to stay in EE. But anyway I dont know how useful if for the greeks to stay in Europe being the "clients" of the rich West....

I have a question for you. Germany owns Greece around 78,958billion Euros because of the war damage they caused during 2 World War (10% of greek population was killed). Greece even had to pay more to nazis because they were forced to give loans to them;loans that Greece never got back. If Greece hat gotten these money, they would never need the "help" of IMF and of their other gansgster friends. Maybe 1940 seems so far away. I will remind you that Greece owned money since 1880!! Germany have not paid debts so many times (First and Second World War and DDR debts) in order for them to survive and I dont understand why this was moral for Germans and not for Greeks! Greeks have the right to delete their debt because 1) the money was never used for the good of the society and noone knows how exactly they were used 2) Before IMF, Greece was mainly paying really high and illegal interests and not the real capital and 3) the country is in the right money in an emergency state (the crisis is turned to be humanistic there) and Europeans really wish from people who got 300E\month to pay the debts to the rich banks?!!! For god sake, show some solidarity, the people down there started to die because of hunger for the sake of bankers!

PS: If you spend one month in Greece not only you will understand why the people fight for their basic rights but you will be probaly first on the line of the demonstators. I dont know where do u come from but in any case dont let your country becomes sklave of the bebts. I really wish you that

And ple
17:36 November 1, 2011 by derExDeutsche

'I dont know where do u come from but in any case dont let your country becomes sklave of the bebts.'

Thank you for your sage advice, Gounis. Yes, we are fighting tooth and nail, to keep President Obama and Bundeskanzerin Merkel from putting us into any more debt with their more 'Bailouts'. Our Governments want us all to be slaves to debt they have created.

'You load sixteen tons, what do you get

Another day older and deeper in debt

Saint Peter don't you call me 'cause I can't go

I owe my soul to the company store'
17:46 November 1, 2011 by Lachner
@ Gounis - I have been to Greece, I have many Greek friends and colleagues and I know a lot about Greek economy, culture and politics, so I can back-up what I am saying. The reason that Greece is in this current situation has a lot to do with tax evasion, living beyond their means (taking up on more debt than they could pay), bureaucratic inefficiency and political corruption. The majority of the Greek labor force is employed by the Government. Therefore, when Greece joined the EU they could borrow money easier and cheaper, so they took up a lot of debt and spent it in higher wages, politicians increased employment positions for the public sector to secure votes and lots of government funds were mishandled or stolen. When the Financial Crisis hit the World markets in 2008, the country was very vulnerable and could not cope with its huge debt load, so they went immediately into recession.

Now they apparently don't want help from the EU so that the country can go bankrupt, but your reasoning with regards to the debt "magically disappearing" is totally erroneous. The banks will recover their debts by capitalizing on Greek public assets (land, buildings and infrastructure). Additionally, if Greece defaults and goes bankrupt no one will lend them money, so I don't understand how they could "rebuild" a new nation and prosper if they have no income, no jobs and no assets. I guess the young people don't care, because most of them are migrating to Germany to find jobs. Therefore, the Greeks should pull their heads out of their butts and accept some help to save whatever is left of their country.

By the way, my comments have nothing to do with hatred or racism towards the Greek culture. Nonetheless, I found it extremely offensive that even though the German government and its people are willing to lend them a hand, they made protests in Athens during the visit of Phillip Rösler (German Economy Minister) in which they displayed the EU symbol in the shape of the "Swastika" and mocked Germany for being Nazis by impersonating Adolf Hitler. Therefore, if there is anyone that has been racially prejudice in this situation, it has been the Greeks.

If it was for me, I would have them all go bankrupt, kick them out of the EU and don't give them a single cent. I could care less for the Greeks if they are disrespecting Germany and its citizens.
18:27 November 1, 2011 by derExDeutsche

'I found it extremely offensive that even though the German government and its people are willing to lend them a hand,'

hab schon lange nicht mehr so gelacht. Holding a country with VAST amounts of Debt accountable (for even just a percentage), when bankruptcy would eliminate ALL the debt, is a helping hand? This is why critics have said the EU was a sham from the start. but no.

'and mocked Germany for being Nazis by impersonating Adolf Hitler.'

funny, I AM German and I also see the similarity. Germans Politicians were not elected by Greeks. Therefore, German politicians telling Greeks what to do should be considered hostile. Govt. Debt is no reason for loss of Sovereignty and Democracy. Traditionally, wars took place before Germany implemented its policy in other sovereign countries. Now Govt. Debt has replaced the Troops, and the smiling face of Socialism, the face of the Fuhrer.
19:29 November 1, 2011 by catjones
Greece is like a cancerous organ in a malformed body. You can either try to cure it or surgically remove it, but we already know the cancer has spread. Removing organs sounds good, until you run out of organs. Curing sounds good, until you run out of money. Having a multiple personality disorder doesn't make things easier.
20:00 November 1, 2011 by SchwabHallRocks
When Greece defaults, instead of paying 50% of the debt, they can negotiate 10% of the debt... or simply not pay at all. But the morning after will be really ugly.

Latin American countries have defaulted numerous times. Anyone remember Argentina around 2000?

"In 2003 estimaties of 30,000 to 40,000 people scavenged the streets of Buenos Aires for cardboard to eke out a living by selling it to recycling plants. This method accounts for only one of many ways of coping in a country that at the time suffered from an unemployment rate soaring at nearly 25%."

I don't know how much cardboard there is in Athens...
20:06 November 1, 2011 by karldehm
I too am getting tired of this whole situation. To be honest Greece is already broke.

No one really wants to face the fact. Do we throw a life line to a sinking person who might pull us down with them? It's a very difficult question to which I don't think anyone has a definitive answer.

Greece's decision to hold a referendum on the question is chickening out. It's not a matter of democracy but a decision that needs to be made by so called qualified people. I am not one of them, as this problem is too complicated for the average citizen to understand. If you don't agree you are in the wrong profession as you should be in banking. Or should have been in banking as you would be a multi- millionaire by now.

Come on Greece, make a decision to whether you are going pay your debts or not, and let us get on with our lives and get to more important matters.
20:21 November 1, 2011 by cambiste
Try searching 'Greek sovereign debt defaults'-it seems they are incurable serial offenders!
20:31 November 1, 2011 by jg.
The people of the country that gave us the word "democracy" want to vote on an important issue for their country. What a disgrace! How arrogant? How distasteful? Why can't they just knuckle under and do as they are told by those superior to them?

Why can't they hold the referendum next week? It's not as if other EU states normally take several months to hold elections or referenda - oh wait....
20:52 November 1, 2011 by Eastard
Education of the public is in order (if possible in Greece)... At the root of all issues is the real impact of bankruptsy of a country... verusus the typical failure of a person to pay their debt. I believe when a country fails it is much worse than just wiping off the debt sheets... and I do not believe the Greek people understand how bad it will be for years...Am I wrong...? All the argument is based on the belief that Greece can simply walk away from deliberate debt and poof ... all is OK... If this is true then they are right... paying if off is foolish... If they are wrong how does the world let them know... whom would they trust to tell them the truth...? It cannot be Germany or France ... even though they are respectable financial authorities... How does anyone help a Greek person who does not want to listen...? The recent call for vote was an interesting way to respond to a crisis... It is clearly more risky than folks may understand in that it could result in those trying to help Europe by funding Greece... deciding it is not worth it... and puling their offer... I would not be suprized if this happens in the next month...
22:37 November 1, 2011 by Logic Guy
Well, the truly interesting thing about life, is that it should be rather easy.

A thing only becomes a problem when people don't understand it.

And the fact is, if all 7 billion of us knew how to "Do as we should", then obviously this world would be perfect.

The Greeks, as with all other people, are struggling simply because they lack the necessary intelligence. This has been the case for humanity since the beginning of time.

And so, the question we must all ask at the end of the day, is what is the truth...

where must we search to discover the enlightenment that's required to

succeed on planet earth?
00:55 November 2, 2011 by Lachner
The problem is that people quite don't understand what will happen if Greece goes bankrupt. They believe that the debt slate is wiped clean and that they can build a new nation and life goes on as usual. If Greece votes against the recently approved bail-out plan and it goes bankrupt, then I hope that the people in Greece are prepared to deal with the electric power failing, the police not working, the gas stations closing, the grocery stores running out of food, widespread looting and riots in all the major Greek cities, retirement checks stop arriving in the mail, ATM machines run out of cash, the banks go bust, schools will be shut down, hospitals run out of supplies, millions of people are left unemployed and no one will lend them money.

Are the Greeks ready for this? Is this what they want to happen to their country?
01:43 November 2, 2011 by derExDeutsche
Argentina's Economic Crisis circa 2001 is a much better example of what can and would happen in case of a Greek default. Argentinians did not move into caves as cavemen and women. the power never went out. They just went bankrupt and had to start building from the ground.
09:24 November 2, 2011 by all4all

Argentina's 2001 Crash is not an even remotely suitable example for Greece, since both the reasons for the crash and the reasons for Arg's ability to get out of it have absolutely nothing to do with Greece at all.

I am half Argentine and I was living there during the Crash--the 'Cacerolazo', when people went out on the streets to boycott banks banging pots and pans. The 10 years before the crash, the whole of the 90s, the Arg peso had been set to the US dollar, benefiting only foreign banks and the very rich.

But here's the catch: unlike Greece, Argentina is a very large country with a small population (about 40 million, in a country 4 times the size of Germany) and immense, unique natural resources, plus the ability to be self-reliant. Argentina has everything--the ruch Pampas, which has been keeping it afloat for the 200-odd yeaes of its existence, soy, oil, you name it. Plus a very resourceful, well-educated populace and huge cheao immigration from poor countries like Bolivia, Portugal and Peru.

This is how it was able to devaluate, close ranks, refuse to pay its foreign debt until it was ready--which it did, when ready. If you've been following the news you'd know that the irony is that, unlike the rest of the world, the Argentine economy is actually doing very well at present. Of course, political corruption and other social illls will most likelt create some other crisis very soon, but that's another story!

And another factor--Argentina is isolated at the end of South America in the middle of nowher, not a tiny little country like Greece and a part of a union like the EU. What hapoens in Arg mostly stays in Arg, it doesnt influence the entire world.

So the Greek situation is totally different. Greece is not a new, young, rich immigrant country. It has been saddled with a stupid socio-political system and corruption and a sense of entitlement in its society for years. Worse, it keps putting off responsibility and self awareness and, each time there's a problem, cries out that Germany is the Boogey Man!

Seriously, grow up! For how long can they keep insisting that 'it's all Germany's fault' because Germans are 'all Nazis'?

I have lost all respect for Greeks, and it's akways been one of my favorite places. To the Germans I say-- boycott the Greeks. Leave tgem be. Let them exit the EU, go bankrupt, whatever, and choose some other place for vacations!
09:32 November 2, 2011 by catjones
In late-breaking news, Greece has voted to change the name of their country to Switzerland. 'We feel with this new name we will confuse our creditors and give us time to think of a solution.'
10:47 November 2, 2011 by AlexR

"Try searching 'Greek sovereign debt defaults'-it seems they are incurable serial offenders!"

Try searching 'the worst debtor nation of the past century' and see what you can find.

To help you out, the worst debtor nation of the past century is... surprise, surprise... Germany. Who said that? A Greek? An Irish? An Italian? No, the German economic historian Albrecht Ritschl in a Spiegel interview.

11:05 November 2, 2011 by Lachner
@ AlexR - Yes, the worst debtor nation of the 20th Century is Germany. Nonetheless, this statement is a bit misleading, since we have to take into consideration that the major reason for this is World War I and World War II which left Germany and Europe in shambles. Germans had to loan money in loads to reconstruct and also paid tons of money in war reparations to other nations (not all of it though). Also, in that article they mention that the best payer of debt of the 20th Century has been also Germany. Why did you omit that? Therefore, in Germany we may have taken up large amounts of debt in the past, but we worked hard, we paid our taxes, we were efficient and we honored our debts.

I think it is ridiculous for you to criticize Germany with regards to its debt or efficiency as a nation, since it is currently the 4th largest economy in the World, the economic and political leader of the EU, it holds some of the World's biggest and most successful companies, tax evasion is minimum and it has been a Global symbol of innovation, stability and efficiency for the past 50 years. I think that Germany has absolutely no fault with regards to the Greek crisis. Therefore, I just hope that the Greeks stop blaming everyone else for their own problems or they will be left in shambles.
12:30 November 2, 2011 by Sastry.M
It is saddening to note where the gallant Greek spirit, which gave the idea of 'democracy' to the world, has gone for good leaving the present day population to rot in speculative corruption and unbridled spending.

Is it not the Greeks who gallantly fought against the Turks and other Asiatic hordes, whose written vernacular was opposite to theirs, and whose despotism was against their ideal of democracy? Yes! It was their analytical thinking which supplied rationality,reason and logic to Western Thought, and methods of spelling into written words of spoken thoughts They integrated the European spirit into an allied effort to defend their freedom and religion during the Crusades.

Even if we should refrain from nostalgic recalling of past glories to meet the present day challenges, what 'modern' progress humanity has really achieved for it to struggle under present day circumstances? If a spirited democratic conjecture of the Greek Prime Minister, to seek his public opinion to dig at the cause of present economic misery should it create world wide stock market failures, what should be future of the 7 billion'th soul just taken human birth on earth? Should the Greeks sum up their spirit of courage to take up a modern crusade against people of similar direction as the Turkish vernacular, they may soon be forced find an Adolphos Hitlerous to create another European disaster.
12:57 November 2, 2011 by luckylongshot
What many people seem to overlook is that what is happening in Greece is the inevitable consequence of the fractional reserve banking system and the way it is structured. It will also not stop with Greece but will consume every country that uses it. Here is a quote from Thomas Jefferson which gets to the heart of the matter. The fractional reserve banking system has given control over the issue of moeny to the banks.

I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.

Thomas Jefferson, (Attributed)

3rd president of US (1743 - 1826)

The issue is whether we allow the transfer of wealth from the public to the banks to continue by maintaining the conveyor belt or whether we turn it off.
14:53 November 2, 2011 by Sastry.M

An apt and excellent quotation. Of note is the genius of Thomas Jefferson as a statesman who foresaw the usurping role of private bankers curtailing civil liberties of people, and thereby the propriety of living in contentment and peace as Providence willed in creating human beings.

Worthy of note is the departure of this benevolent humanist in 1826, relinquishing his services on earth and the inroads into the U.S by European Bankers, more famously, the Lehmann Brothers and Goldman & Sachs, fifteen years after his departure and pleading insolvency today.
17:55 November 2, 2011 by AlexR

"I think it is ridiculous for you to criticize Germany..."

Please hold your horses and stop the personal and unsubstantiated attacks. Who "criticized Germany"? I only posted an interview of a *German* economic historian on the biggest *German* magazine, without expressing any personal thoughts about this. Where exactly is the "ridiculous" and the personal "criticism" on that?

If I wanted to "criticize Germany" or better, express my personal opinion about Germany (or France for that matter), I could have easily done so because, being half-German half-French), I studied and worked in both countries for the biggest part of my life. It would have been more difficult to "criticize" Greece, even though I was assigned by my agency there for 3 years (the last of which was after the crisis has started).

So even though I worked for 3 years in Greece, I cannot say that I know it all about Greece but you on your posts seem to think that you are quite entitled to "criticize Greece" based only on some short vacations and/or business trips or "talking to Greek friends". I am sorry to break it to you but saying that you "know a lot about Greek economy, culture and politics" by just visiting for a week a 5 star resort on an idyllic Greek island, is like me saying that I know a lot about US because I went to Disneyland.

Of course, you don't need to live and work in one country in order to know many things about it, though the "direct" way is the best way. The" indirect" way is to acquire some knowledge by being well informed about it. I'm afraid that, this is clearly not the case based on what I read on your previous posts. Except of some correct points, most of your points are either generalizations and myths or half truths and inaccuracies. And certainly not based on facts.

If you want facts I can give them to you on another post because this one is already quite long. But as a starter, it is correct that corruption is quite spread and that they were spending beyond their means; the latter is true about the government but I'm not sure if it's true about the majority of the people. On the other hand, it's absolutely incorrect that "all the Greeks evade paying tax" or "every Greek wants to leave EU (sic) and go back to the drachma" or that the "majority of the Greek labor force is employed by the Government". Those are generalizations and oversimplifications based obviously on the lack of good knowledge about the "Greek economy, culture and politics".

As a final note, I believe that all the discussions about Greece and the PIIGS are used as a smokescreen to hide the real culprit which is the extremely problematic financial system combined with the structural inefficiencies of the eurozone. This, or I must seriously believe that all the PIIGS countries and soon probably Belgium and France "were living beyond their means", "didn't pay taxes" and "elected the wrong politicians".
03:15 November 3, 2011 by Sibins
I can not beleve this:) 'Greece' should pay back money or move to Asia Minor where they belong.

If those countries are called Pigs, Greece is Pigy Bank. Parasite state sucked europe dry and now they think they are some sovereign nation that can avoid paying bank even the half of the money
11:54 November 3, 2011 by Lachner
@ AlexR - The tax evasion in Greece is currently at 49%, so one can argue that this classifies as a majority (there are approximately €20 Billion of Greek funds currently being held in Swiss bank accounts to avoid paying taxes). The public sector of Greece accounts for 40% of total GDP. It's not a majority, but it just shows you how big the public labor force is and the effects that this has on the growing budget deficit. Most modern economies rely less on the public sector for GDP development. In Greece, the trend has been to increase the public sector. My arguments are against the Greek opinion that Germany is "the boogie man" and the culprit of all their current problems. I find it laughable that they even blame Germany, when they willingly took up on all their loans after they joined the EU in the year 2000 for investment in the required infrastructure for the 2004 Athens Olympic Games, they increased salaries in the public sector and political corruption took a large chunk of that money to fatten their pockets. Also, Greece's biggest ally in terms of exports (€2.5 Billion per year) is Germany. The general opinion in Greece is that they want to default their debts, leave the European Union, adopt the "Drachma" currency and deal with the negative economic consequences just like Argentina did from 1999 - 2001. What they don't realize, is that they will completely lose their ability to borrow money, they will lose all credibility internationally (this will affect exports), the country will run out of cash in 2 months or less (the ECB will cut their cash life line), the banks will go bankrupt, citizens will lose their savings and many of the country's public services such as electricity, police and health care will be suspended due to lack of funds. In Greece, 94.5% of the electric production is generated via fossil fuels. If the country is bankrupt, there is no cash and no one gives you credit to borrow money, how will they buy fuel to produce electricity? The comparison with Argentina in terms of defaulting their debt is "piss poor", since the main reason that the Argentina Economy was able to recover was due to considerable increases in agricultural prices (particularly soy beans) and Argentina has a very strong agriculture industry (one of the largest in the World) and they have vast rich natural resources (gold, coal, zinc, copper, uranium, metal ore, and petroleum). In comparison, the Greek agricultural industry represents only 3.3% of GDP, they don't have vast natural resources and they currently benefit greatly from the Common Agricultural Policy of the European Union (which will disappear after they exit the EU). The only advantages that Greece could have of defaulting is that by going back to the Drachma they could devalute the currency in order to begin their economic recovery and also, that the cost of products and services would fall considerably and this would benefit the tourism industry (20 Million visitors per year).
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