Athenian standoff

15 November 2011 By Hugo Dixon Follow @hugodixon

The new coalition’s second party says it would be humiliating to sign a declaration of support for the latest bailout as demanded by the European Commission. If neither side backs down, Athens will be heading for a disorderly default the rest of Europe is ill-prepared to contain.

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Antonis Samaras, leader of Greece’s conservative New Democracy party, said on Nov. 14 that he would not sign a pledge of support for conditions demanded by European Union officials on the country’s new bailout agreement. He said that to do so would be “humiliating”, adding that his word should be sufficient.
Euro zone finance ministers and EU Economic and Monetary Affairs Commissioner Olli Rehn asked Greece on Nov. 7 to present to them a letter signed by the main political parties, stating their commitment to the terms agreed on Oct. 27. Greece’s international lenders have warned they will withhold the next 8 billion euro tranche of aid unless Greece takes decisive steps towards reform.
Greece has three bond repayments due in December: 1.2 billion euros on Dec. 19; 980 million euros on Dec. 22; and 4.6 billion euros on Dec. 29.
Figures released on Nov. 15 show that Greek GDP in the third quarter was 5.2 percent lower than a year earlier.

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