GREEK DEBT RELIEF NOT IN THE CARDS

• Comprehensive debt operation is required to return Greece to economic health.
• Greece needs either a debt write-down  by 30% but even with debt relief, Greece’s debt ratio would still be at 142% GDP through 2022
• Greece needs maturity extensions to 40 years from 20 years currently
• Greece’s additional financing needs through 2018 total above € 60 billion
• Greece’s year-ahead financing needs alone total € 29 billion
• Imperative Eurozone covers at least € 36 billion in finance under highly concessional terms
• Greek debt sustainability review assumes 0% growth in 2015, 2% in 2016 and 3% in 2017

There are three reasons why Berlin won’t want to back down from its position.

1. German public opinion is like public opinion in a lot of Eurozone countries hostile to sending more money to Greece. Politically, another bailout let alone debt relief would be hard to sell to German voters or pass through the German parliament.
2. Second, the Germans fear that offering Syriza better terms would encourage more southern European countries to elect anti-austerity, left-wing parties in the hope of wrestling concessions out of the Eurozone and the European Central Bank. With elections in Spain later this year, the last thing they want to do, is to do anything that will boots Podemos.
3. The German government simply no longer trusts Syriza and the Greek government. It simply won’t believe any commitments that Tsipras makes now.