The last few days have been very difficult for Greece with uncertainty looming over its future. But that changed on July 13 with some respite for Greece, as the leaders of Eurozone and Greece came to an agreement on the three-year 86 billion euros ($129 billion) bailout required to salvage the tottering Greek economy. Most of the terms and conditions require the Greece government’s near total surrender to the creditors. However, it also provides Greece a chance to hold on to the euro as its currency and stay in the Eurozone, preventing a “Grexit.”
Speaking to India Writes Network, K.P Fabian, a former Indian ambassador who has served in many capitals in Europe, said: “Sanity has prevailed.” He added that if Greece were shown the door, the consequences would have been devastating for the euro. Mr Fabian, who has been closely tracking the Greece debt crisis, said countries such as Germany and Finland had much contempt for Greece and hatred towards Greek Prime Minister Alexis Tspiras.
The Parliament in Greece is expected to start passing a slew of economic reforms within the next few days. On being asked if economic reforms can be implemented, Mr Fabian said Parliament will approve reforms. He also said people have recognised the difficulties and problems. Whether they will be implemented as per the creditors’ wishes, is difficult to say, he said.
The world markets have reacted positively to the news. There could be some political consequences in countries such as Spain which is going to have elections soon, said Mr. Fabian. “I wouldn’t say the worst is over. The Greek debt is unsustainable and they need to restructure and recapitalize their banks.”
The governments in Eurozone would discuss ways to make the Greek debt more manageable. The Athens government is expected to make its first proposals by July 20. Greece, for the time being, has probably been saved from a devastating collapse, but it will need to compromise a lot to regain its grip in the region by implementing tough and drastic measures. While the bailout has given temporary relief, there is a long way to go away before Greece, the cradle of Western civilization, can recover from the festering crisis and take charge of its destiny.
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