Greece owes how much - nay

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The short-term borrowing costs of the Greek State, as reflected in the 13, 26 and 52 week bonds auctions, are at historically low levels with negative interest rates for all the duration of the issues. In the recent auctions in August and September it stood at Regarding the baseline scenario, it has improved marginally compared to the 10th report due to the further reduction of Greek forward interest rates in mid-August.

In the baseline scenario, debt is reduced to In the higher risk scenario, debt is reduced to According to the financial staff, the yield spread between the ten-year Greek and the corresponding German benchmark moved to the level of basis points during At the end of September the yield difference is at the level of units with the current yield of the ten-year bond being around 0.

In January , Greece reissued a year bond with a nominal value of 1, million euros and a settlement value of 2, million euros with a private placement, followed in February by a consortium issue of a ten-year bond of 3, million euros, with a fixed interest rate of 0. Then, in May , a five-year bond issue amounting to 3, million euros with zero interest rate was issued and in June , the consolidated reissue of the ten-year bond amounting to 2, million euros with a yield of 0.

In September , the five-year and thirty-year bonds amounting to 1, and 1, million euros, respectively, with a yield of 0. The short-term financing was realized with monthly issues of 13 and 26 weeks interest-bearing bills and week quarterly issues, as well as conclusion of repos agreements mainly with the General Government bodies.

Yet most of this is now owed to other eurozone governments, rather than the private markets, and it is repayable over many decades. Greece has already left the European Union in a manner of speaking: it is now part of the Third World. This still left Germany with debts it had incurred in order to finance the reparations, and these were revised by the Agreement on German External Debts in After another pause pending the reunification of Germany, the last installment of these debt repayments was paid on 3 October Japan is the country with the highest national debt to GDP ratio.

The national debt is more than twice the amount of annual gross domestic product. Austerity measures also created a humanitarian crisis: homelessness increased, suicides hit record highs, and public health significantly deteriorated.

The government sent the country on an unsustainable fiscal path. In order to remain within EU requirements on debt, the government hid some of its borrowings in special debt-holding corporations.

Secretive loans to off-balance companies cost more in interest payments that the government would have paid on bonds of the equivalent amount. So, in trying to source more money for government spending, this scheme actually consumed more of the national budget in debt servicing costs. This resulted in a widening budget deficit, which, in turn, required even more creative methods to finance. In , the country came clean on its true debt levels.

The total debt and the interest that it obliged the government to pay was calculated to be unsustainable. In those circumstances, governments have to turn to the IMF for a bailout. Those conditions reign in government spending and reduce budget deficits and they play a bigger role in resolving the debt crisis than the actual loan amount.

If a country is not able to balance its books and relies on ever-increasing debt to continue its government policies, there comes a point when no one will lend any more money because it becomes clear that the country can never pay it back.

Adding IMF debt to an unpayable mountain does not resolve the problem. The Greek government refused to accept IMF loan conditions and threatened to default on all of its existing debts — many countries have done this in the past.

However, as Greece is part of the Eurozone, other European would have suffered a damaged credit rating if that had happened. When faced with a government that refuses to pay its debts, creditors are often prepared to negotiate a compromise. This is called a debt restructuring. Creditors may be prepared to lengthen the maturity terms of bonds or reduce the loan amount in exchange for higher interest.