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The 30-year plan does nothing to reduce Greece's debt burden and could complicate any eventual restructuring.
That breeds uncertainty and even panic among investors, who already doubt that the Greek deal that the European leaders finally sealed on Friday night will forestall an eventual restructuring of Athens' crippling debt.
The eventual restructuring of the bank will aim to isolate those assets from the strategic activities of the group, which are expected to continue in business in some form.
The plan does not reduce that and French machinations to roll some private-sector debt into a "voluntary" package of cash and long-term bonds may make an eventual restructuring harder (see article).
Anyone who looks hard at Greece's debts and the interest rate it is paying on them can only conclude that, unless growth rebounds unexpectedly strongly, an eventual restructuring of Greek debt remains highly likely (see article).
Removing debt held by private holders and replacing it with strict obligations to the EFSF could make an eventual restructuring harder, should that prove unavoidable.Whereas excessive public debt in Greece has arisen from years of public profligacy, Ireland's problem has been made acute by the unbearable cost of propping up its oversized and undercapitalised banks.
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Short-term bill auctions to roll over maturing debt are encouraged in the deal reached by Greece, the EU and the fund but the threat of an eventual debt restructuring makes investors unwilling to lend for long.
Even if that peril is avoided, the paths to rehabilitation for Greece and Ireland look so difficult the black hole that is the Irish banking system could get still deeper, for instance that it is hard to see how they can escape without an eventual debt restructuring.
But if politicians can't dislodge the market's expectation of euro zone states' insolvency, the crisis will continue as investors foresee an eventual debt restructuring or default and bring it forward in time.So what will a success for the politicians require?
The chart below shows the volume of loans since the program began in 2007, with the heaviest use during the depths of the financial crisis and a smaller peak earlier this year, when investors were concerned that Greece and its creditors would not reach their eventual agreement to restructure the country's debts.
Mr. Fourtou conceded, however, that a crucial part of that restructuring, the eventual sale of stock in a newly reorganized Canal Plus, was no longer on the agenda.
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