Dramatic consultations during telephone calls to political leaders

The minister’s contacts with leaders of political parties in view of the summit on Thursday has taken on dramatic proportions, on a day when the debate on selective partial default and bankruptcy has been on the lips of many.

A round of telephone calls by the Prime Minister made to the leaders of opposition parties ended shortly after 7pm on Tuesday.

G. Papandreou had a telephone conversation with Mr. Antonis Samaras and reiterated the red lines he has set, while the ND chairman, having said what he wanted publicly, only spoke with the PM for three minutes.

Aleka Papariga once more discussed the Communist Party’s views on the policies implemented, stating that her party had been “vindicated”.

The longest call was had with LAOS chairman, Mr. G. Karatzaferis. Mr. Karatzaferis was of the opinion that private investors should not participate in the country’s salvation, but both party officials state that the telephone call took place under agreeable terms.

Mr. Karatzaferis seems to have recommended that the Prime Minister say a “proud no” rather than a “humiliated yes”.

Finally, Mr. Papandreou called the Chairman of the SYRIZA parliamentary group, Alexis Tsipras, who once more reiterated his opinion that there should be a cancellation of part of the debt and the transfer of another part to the ECB.

As is known, Athens is pushing for a solution that will include an extension of the bonds due date, scheduled for 2020, an amelioration of loan interest rates and a repurchase by Greece of interbank bonds at current prices, through the aid and guarantees from the EFSF.

The problem, of course, lies in the fact that if there is such an elongation with private investor participation, the situation will be considered a credit event by the international credit agencies and as a result, Greek bonds would no longer be accepted by the ECB.

In such a case, the ELA mechanism of liquidity will be triggered for Greek banks, which will in turn tighten their lending policies while, in an extreme scenario, this could lead to the imposition of ceilings to citizen withdrawals.