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6/16/11

Netherlands: Dutch will only agree to further funding for Greece if private investors participate in Greek bailout

The Netherlands will only approve further support payments to Greece if private creditors accept substantial extensions on the maturity of Greek debt, Mr. J.K. de Jager, the finance minister, announced in a letter to parliament. European Union aid to Greece must be approved by all 27 member states, meaning that should the Dutch refuse payment it would trigger the end of the support payments and potentially a Greek default.

The government has relied on the opposition Labor and left-liberal D66 parties to push previous aid payments through parliament. But in recent weeks Labor has become increasingly critical of the bail-out strategy.

Parliament’s finance committee is scheduled to meet on Tuesday to respond to Mr De Jager’s report.

Some economists believe a default by Greece would not only be the best solution for Greece and the EU, but also serve as an example to the other EU-member states, which have received EU bailouts, to take austerity measures very serious. It would certainly not cause the EU to fall apart as some people say, but rather strengthen the monetary and political union by getting rid of those member states ( bad apples), which are not taking the rules and regulations of EU membership they agreed to seriously. As to present hysterical reactions by the financial community and Wall Street to avoid the above scenario, these are quite normal, they are purely based on self interest, and not to forget, their insatiable greed.

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