Der Spiegel: 'There Is No European Emergency Plan'

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Greece is struggling to reach an agreement on debt relief with its private-sector creditors. But even if it ultimately does, the country may need vastly more funding than has been envisioned so far. German commentators on Friday say it's time for a bit of honesty from Europe's leaders.

Greece needs more money. That would seem to be the growing consensus in Europe as negotiations over debt relief between Athens and the private sector drag on. On Friday, Jean-Claude Juncker, who chairs meetings of euro-zone finance ministers, became the most recent European politician to sound the warning bell.

"If Greece's ability to sustain debt is proven and there is an overall understanding with the private sector, the public sector will also have to ask itself whether it will not provide help," he told the Austrian daily Der Standard in an interview published Friday.

The talks between Greece and the Institute of International Finance, which is representing the country's private creditors in the haircut negotiations, have proven difficult as the two sides have been attempting to come up with an interest rate on the new bonds that will be issued to current debt holders. European politicians have said that this rate should be as low as possible so as to give Greece a shot at meeting its goal of reducing its sovereign debt to 120 percent of its economic output by 2020. Institutional bond holders, however, are holding out for a higher rate and resisting any agreement that could push their losses beyond the 50 percent they had originally agreed to. .....................(more)

The complete piece is at: http://www.spiegel.de/international/europe/0,1518,811792,00.html

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