Former Central-Bank Governors of Argentina & Mexico, explain why Greece should not leave the Euro.
There is no question that a Greek exit from the euro would be convulsive and impose enormous costs on the Greek economy and its people. But will those costs be any higher than if Greece stays on its current path? That question is far from settled.
EUROPE’S handling of its sovereign-debt crisis has been disastrous. Euro-zone leaders succeeded in turning a manageable economic problem in Greece into a political conundrum that jeopardises the single currency. A premature insistence that private-sector creditors take a hit on Greece has fostered contagion. Massive write-offs are necessary but nobody yet knows what constitutes sustainable debt or what Greece’s “real” GDP is. In Latin America in the 1990s debt relief was granted only when fiscal adjustment and structural reforms were very advanced. This is certainly not the case in Greece….. [continue reading the full article via The Economist]