CIAO DATE: 08/2014
June 2014
Centre for International Governance Innovation
The 2012 Greek debt exchange was a watershed event in the euro area debt crisis. It generated fears of contagion and was viewed as a threat to the euro itself. There is a heated debate as to whether the debt restructuring should have taken place sooner. This paper argues that a deep haircut up front, under threat of legislative action, would have been seen as unnecessary and deeply coercive.
Resource link: Sovereign Debt Crisis Management: Lessons from the 2012 Greek Debt Restructuring [PDF] - 522K