Athens News Agency: News in English, 11-05-07

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From: The Athens News Agency at <http://www.ana.gr/>

CONTENTS

[01] Greek 'euro exit' speculation denied 

[01] Greek 'euro exit' speculation denied

Asked if it would be easier for Greece, as suggested in a controversial article in the German magazine Der Spiegel, that Greece leave the euro currency, Papaconstantinou replied "no, that is impossible".(ANA-MPA)

"No, that is not possible. First of all because there is no mechanism for a country's exit from the euro. The consequences would be catastrophic: The fiscal deficit would double, the buying power would collapse, the banks would be hard hit, and we would fall into a war-period recession," Papaconstantinou explained.(ANA-MPA)

On restructuring of the state debt, Papaconstantinou said he continues to maintain that the cost of a restructuring largely outweighs any possible positive effects, warning that if Greece unilaterally imposed losses on holders of state bonds, the markets would exclude it for a very long time because the consequences to the banking system would be incalculable.(ANA-MPA)

The finance reiterated that only intensification of the streamlining measures, with the achievement of a primary surplus and return to growth can, in the medium-term, convince the markets.(ANA-MPA)

On Greece's return to the international markets, Papaconstantinou noted that six months in a huge space of time, and expressed his belief that after the summer, when the streamlining and privatisations plan will have progressed, the markets will settle down.(ANA-MPA)

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