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A blog by Leon Oudejans

The Australian option for EU debt relief to Greece

13 February 2017


Donald Trump’s candidate for ambassador in Brussels has angered people for saying uncomfortable truths. Ted Malloch: “Whether the eurozone survives I think is very much a question that is on the agenda. We have had the exit of the UK, there are elections in other European countries, so I think it is something that will be determined over the course of the next year, year and a half. Why is Greece again on the brink? It seems like a deja vu. Will it ever end? I think this time I would have to say that the odds are higher that Greece itself will break out of the euro.” (Guardian)

Malloch‘s remarks follow a recent IMF warning that “Greece is on track to fall short of budget-surplus targets set under a bailout by the nation’s euro-zone creditors” (Bloomberg). This is far from new. ZeroHedge: “For the umpteenth time, the IMF has warned that Greece cannot meet fiscal targets set by its creditors. And once again, the IMF insists that it will not be a part of the “Troika” unless the goals on Greece are realistic.”

That same 7 February, Eurogroup President Jeroen Dijsselbloem claimed that he was “surprised” by the “unnecessarily pessimistic” IMF view, while suggesting this view was outdated due to recent Greek growth. Dijsselbloem said that Greece’s creditors, which include the IMF as well as Eurozone members, would still be prepared to further ease terms of Greece’s debt, while ruling out any forgiveness of principal debt. (eg, FTGreekReporter).

Relief of Greek debt is inevitable. On 9 October 2012, Donald Trump tweeted that “Greece should get out of the euro & go back to their own currency–they are just wasting time.” It might be an uncomfortable truth but Trump was and is right and so is his EU ambassador Ted Malloch.

Obviously, the EU should ask something in return. The EU should insist on a debt for equity swap: Greek debt relief in exchange for selling Greek islands to the EU. Greece will be the first country on a “multi-speed” EU track, for instance through an associate EU membership. Tourism will be boosted by use of the Greek drachma. Similarly, new loans will properly reflect risks (eg, credit default, currency, country) and new (high) interest levels will prevent inefficient use of new loans.

The EU will use these former Greek islands to accommodate illegal refugees from all over Europe. They will await their repatriation to their home countries on these islands The EU will end the humiliating Greek refugee accommodation by using a proper Bath, Bed & Food arrangement. The situation will resemble the Australian solution for illegal immigrants and refugees.

This new situation will also address the EU-Turkey deal following the 2015/2016 migrant crisis, including its widely criticized agreement to “re-energize” Turkey’s bid to join the EU, Euro 3 billion financial aid, and the waiver of visa restrictions (Wiki). In simple words, Turkey will no longer be able to blackmail Europe.

The Australian solution might be severely criticized by some media but it also offers a unique way forward in the Greek government-debt crisis and the European immigrant and refugee crisis.

Down Under (1980) by Men at Work – artists, FB, lyrics, video, Wiki-1, Wiki-2

Buying bread from a man in Brussels

He was six foot four and full of muscle

I said, “Do you speak-a my language?”

He just smiled and gave me a Vegemite sandwich


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