IIF’s Charles Dallara on Greek elections’ day after

Alima Naji — Fri, 15 Jun 2012 08:24:08 +0000

Referring to the situation in Greece, Institute of International Finance Managing Director Charles Dallara said: “The voluntary private-sector debt exchange led to an unprecedented level of debt reduction, which presents Greece with an excellent opportunity to move forward. Significant progress has also been made on necessary fiscal adjustment and structural reforms, with the strong support of the official community. However, it is clearly important following the June 17 elections that a new Greek government reaffirms its commitment to the central tenets of its reform program—liberalizing labor and product markets, advancing privatization, and strengthening the competitiveness of the economy with a greater focus on fiscal and structural reforms.”

Further, the IIF noted that given the severe contraction of Greece’s economy, the pace of short-term budgetary adjustment needs continuous examination for potential easing: it should be recognized this might require modest additional financing support. With this approach, the efforts being made to carry out Greece’s difficult adjustment program should begin to bear visible fruit.

“At the same time, official creditors should recognize that in an environment of severe economic contraction, the pace of short-term budgetary adjustment needs continuous examination for potential easing: The point about the short-term budgetary adjustment may be applicable well beyond Greece, with a suitable degree of differentiation depending on individual countries’ circumstances. Such a balanced approach may allow for stronger growth in the near term while permitting more determined reform effort in the medium term,” IIF said in a news release.

“4 decades of inadequate political leadership in Greece” – IIF

AlYunaniya Staff — Sat, 19 May 2012 21:52:58 +0000

In a presentation titles “Lessons from the Greek Debt Exchange:, at the Institute of International and European Affairs in Dublin, Institute of International Finance (IIF) chief Charles Dallara argued:

“We should understand in my view having spent a lot of time in Greece over the last 9 months, that what we are seeing there is not just an expression of frustration by the Greek people about quote austerity, but by an expression of frustrations of what they consider to see of 3 to 4 decades of really inadequate political leadership that has led them to this position, my sense, and I certainly don’t want to speak for the Greek people, but I’ve talked to a lot of people, and I had the privilege to live in Athens for two years a young naval officer so perhaps I feel I have my own touch of Greek roots, and my sense is that there is a profound sense of disappointment at where their political leadership from both the common parties that have guided them for most of the last decades has left them.

And a determination to seek new directions, by either new parties new leaders, or through the leaders of the old traditional parties trying to convince the Greek people that they see a way forward, and I think it’s going to take some time for this to shake out to allow the Greek democratic process to run its course. And I think it is incumbent on the rest of us, and that would include other European leaders, to pause in what has been a very popular game of how to tell the Greeks how to run their lives.”

“In my view,” Dallara noted, “there has been much too much of this, and we are entitled to our opinions and I think we all have perspectives but I am somewhat troubled by what the policy makers around Europe seem inclined to pine on Greece’s economic problems and its future.

Of course Greece’s future is pivotal to the rest of Europe, but we need to allow a little time for the Greek people to find their way forward, by respecting the fact that the current government has in some respects done a remarkable job of steering them through a extremely difficult period, this technocratic government has only been office for 6 months I think, they have achieved a lot.”

Dallara added: “Greece has undergone most of the pain of its economic adjustment; it has experienced a contracted economy more than twice the contraction of the Irish economy almost 20 percent cumulative by sometime this year. It has experience severe unemployment, dislocation of workers, severe budget cuts and really a banking sector that has been rendered dysfunctional. If Greece sustains its reform program, one I hope will be adjusted and come to new realities… its likely the dividends the of their efforts will emerge within the course of the end of this year and the beginning of next year.”

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IIF’s Charles Dallara on Greek elections’ day after

“4 decades of inadequate political leadership in Greece” – IIF