Global economic contagion: euro zone – greece crisis threatens to “open door to hell”?!

Global economic contagion: euro zone – greece crisis threatens to \”open door to hell\”?!

Greece’s former finance minister has told Sky News that if Greece reneges on its bailout deal with the EU and the IMF it will “open the door to hell”. Sky News last interviewed George Papaconstantinou two-and-a-half years ago. In December 2009 he told how Greece could survive independently and Greece’s creditors had nothing to fear – they would get back every euro they were owed. A lot has changed since then. Greece is in the process of borrowing 240bn euros of emergency loans from the EU and the IMF (in return for pledges to raise taxes, cut spending and balance the books) and investors holding Greek debt have been forced write off up to 50% of their money. Even now Greece remains heavily in debt, deep in recession (now in its fifth year) and without a functioning elected government. Mr Papaconstantinou lost his position as finance minister last summer, shortly after the second bailout package was agreed. In the general election, two weeks ago, he also lost his seat as an MP. He was not alone as support for his Pasok party collapsed. The result of the election was inconclusive and, ultimately, no party was able to form a coalition government. In four weeks’ time Greece will vote again. The opinion polls suggest that were an election to be held tomorrow the result would, once again be inconclusive, but the Syriza party, which is promising to “tear up” the bailout agreement with the EU and the IMF, continues to attract support. Mr Papaconstantinou is the man who negotiated ……