While Greek Prime Minister Antonis Samaras is working toward trying to make the economy recover in the face of daunting odds, the international financial comglomerate Citi, which includes Citibank, said it believes he won’t make it and that the country will be pushed out of the Eurozone of the 17 countries using the euro as a currency.
“A combination of creditor fatigue and austerity fatigue will lead Greece to exit the euro area with a probability of 90% in the next 12-18 months,” Citi analysts stated in a report. Samaras is about to impose another $14.6 billion in spending cuts in a desperate bid to reduce the country’s deficit from 9.3 to 3 percent over the next two years, although there are signs that international lenders who demanded austerity measures may relent and give him another two years, if his government lasts in the face of strikes and protests that have already started.
Inspectors from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) are preparing a report on Greece’s progress on reforms and Citi said that it expects that will recommend no further funds for Greece beyond a first series of $152 billion in rescue loans that is about to end and a pending second bailout of $172 billion.
The report also refers to a German minister saying that the German government has decided to keep Greece in the Eurozone and Citi stated that statement was in line with earlier statements from Chancellor Angela Merkel who said she doesn’t want to see Greece forced out but that it must adhere to more austerity.
“However, as we argued before, this is unlikely to be a carte-blanche for the future: unless Greece meets the agreed requirements, Germany will not be willing to keep the country in the euro. The attempt to delay the decision on Greece further looks reasonable to us and we expect that the ECB will tolerate a further expansion of the ELA by the Greek Central Bank,” Citi added.
See all the latest news from Greece and the world at Greekreporter.com. Contact our newsroom to report an update or send your story, photos and videos. Follow GR on Google News and subscribe here to our daily email!
