Bad News for Greece by Claudia Sonea

Will the European Union last? This is the main concern nowadays due to the debt crisis that hit the Eurozone. After 17 years since its foundation, the future of the economic and politic union is questioned as the degree of instability increases more and more. Greece, one of the fastest growing countries in the eurozone, was the first to step up and ask for help as the public debt reached alarming peaks that the current government was unable to handle. In a bid to help the state members overcome the debt crisis, the EU and the IMF (International Monetary Fund) decided to introduce a bailout plan similar to that adopted by the ! USA during the recession. Thus Greece received a 14.5 billion euros package aid agreeing in return with the austerity measures that would help the country reduce the debt. The measures were mainly directed towards the Greeks who were already struggling with money issues and had a hard time to live from the salary. It is, therefore, not at all surprising that the Greeks rejected the measures and the country is thorn apart by protests. As the situation wasn’t worse enough, Moody’s, an American credit-rating agency, just downgraded sovereign rating from A3 to Ba1 for Greece two months after Standard & Poor's. Other major international rating agencies also threatened to reduce the sovereign rating to junk status if the country doesn’t show an improvement. The downgrade means that some investors will be unable to buy Greek debt and the borrowing costs will be much higher. Taking into consideration that Athens is currently undergoing a ! campaign of attracting investors to rehabilitate the country&#! 8217;s e conomy, the downgrade is one of the worse things that could happen. Stay connected to see what will happen next…..

related story (sgx17575): http://www.france24.com/en/20100614-moody-greece-downgraded-...

by Claudia Sonea for Cantell TV (http://cantell.tv)

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