Monday 24 October 2016

Grexit 'would damage the very nature of single currency'

Colm Kelpie and John Mulligan

Published 27/05/2015 | 02:30

Greek Prime Minister Alexis Tsipras
Greek Prime Minister Alexis Tsipras

A Greek exit from the Eurozone would be a major problem as the very nature of the single currency would be damaged, European Economics Commissioner Pierre Moscovici has warned.

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Athens has raised the spectre of default as the deadline looms for the first of a series of payments due to the International Monetary Fund (IMF).

Greek politicians have warned that the first of those payments, due on June 5, could be missed unless a crucial deal is reached with creditors to unlock much needed bailout cash.

On a visit to Dublin yesterday, Mr Moscovici said more progress had been made in the talks in the last three weeks than in the last three months.

But he added: "We need more effort in order to reach a comprehensive agreement on a set of reforms which are necessary to enhance the Greek economy's competitiveness. The Commission has just one plan. There is no plan B."

However, at an event organised by the Institute of International and European Affairs (IIEA), Mr Moscovici was asked if the Commission genuinely didn't have a plan B.

It was put to him that if that was the case, it was irresponsible.

But the Commissioner stressed this was the case.

"Exiting of Greece out of the Eurozone would be a major problem," Mr Moscovici said.

"The euro is our single currency and there is a sense of irreversibility there. And if one country would have to leave the Eurozone, it would be the nature of the euro which would be damaged. And this is why we have only a Plan A.

"And this Plan A is a solid Greece, a reformed Greece, inside the Eurozone. That is what we are working hard to achieve in the days to come." Reuters reported yesterday that Greece could avoid paying back the IMF on June 5 without defaulting if it lumps together all IMF repayments due in June and pays them at the end of the month.

Quoting unnamed officials, the agency said the missing of the June 5 payment day, if a lump payment were to come later, would not constitute a default, although it might trigger a negative market reaction.

Meanwhile, Ryanair said yesterday that Greece could become an even more attractive destination for the carrier if it was outside of the Eurozone.

Irish Independent

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