Bloomberg News

Greek Bailout Rejection Would Be Catastrophe, Ex-PM Says

May 18, 2012

A unilateral rejection of bailout terms by Greece would be a “catastrophe” that would “unavoidably” lead the country out of the euro area and possibly the European Union, former Prime Minister Lucas Papademos said.

“We are, once again, at a critical crossroads,” the former European Central Bank vice president said in an open letter to the Greek people posted yesterday on the website of the prime minister’s office. “The decisions that we make in these burdened times could mark Greece’s course for decades.”

Papademos, who as Bank of Greece governor oversaw the country’s accession to the 17-nation currency bloc, became interim prime minister in November to implement Greece’s sovereign-debt restructuring, the largest in history, and secure a 130 billion-euro ($165 billion) financing package from the European Union and the International Monetary Fund.

Panagiotis Pikrammenos was sworn in as head of a caretaker government on May 16, replacing Papademos, to steer the country to repeat elections next month after a May 6 poll failed to yield a viable government. Alexis Tsipras, whose Syriza party was catapulted to second place on May 6, has called for a rejection of Greece’s bailout terms.

Greece must carry out the structural economic reforms demanded by the program to maintain its place in the EU’s core, Papademos said in his letter. Reform efforts already made during the country’s financial crisis, which began more than two years ago, haven’t been in vain, and any effort to amend the country’s program should be made in a “spirit of cooperation with our European partners,” he said.

“At a time when many countries, including in our neighborhood, are working hard to win a place in the EU, it would be tragic for us to end up in a reverse direction toward the exit,” Papademos said.

To contact the reporter on this story: Marcus Bensasson in Athens at

To contact the editor responsible for this story: Craig Stirling at

The Aging of Abercrombie & Fitch
blog comments powered by Disqus