Eurozone debt crisis: global lenders face ‘killer losses’ on Greek debt

Wednesday, May 16, 2012
By Paul Martin

Foreign holders of €422bn of Greek debt were warned to brace themselves for “killer losses” as coalition talks in Athens collapsed, threatening Greece’s future in the eurozone.

By Louise Armitstead
TelegraphUK
15 May 2012

The euro tumbled to a four-month low and European stock markets dropped as political leaders and economists warned that the next round of elections called in Athens amounted to a vote on Greek membership of the euro

“What’s at stake isn’t just the next Greek government,” said Guido Westerwelle, Germany’s foreign minister. “What’s at stake is the Greek people’s commitment to Europe and the euro.”
“A second vote means Greece is edging closer to the point where it’s inevitable they have to exit the euro,” Fredrik Erixon, head of the European Centre for International
Political Economy in Brussels, said. “No other course of events is now likely.”

As the Greek president, Karolos Papoulias, admitted defeat on coalition talks, Alexis Tsipras, leader of the radical Left-wing Syriza party which is leading the Greek polls, said he couldn’t “guarantee” the country would stay in the euro.

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