Interviews

Discussion on the Greek Crisis, Brexit & the Day After

by GreeksConnect Team



We met Mr Thanasis Vamvakidis at the Bank of America Merrill Lynch head office in the City of London.  As Head of FX Strategy for a major global banking institution and a spokesperson for BBC and Bloomberg, his opinion on both the Brexit and Hellenic crises holds considerable weight.    

The Hellenic Crisis - The Post Memorandum Era

Regarding the Hellenic crisis and the exit from the Memorandum Agreement, Mr Vamvakidis highlighted the importance of this first step, since it was an extremely difficult eight-year period for the country, and emphasised that the major advantage is that the deal on the public debt, though still huge, allows Greece to postpone the problem until 2032.

Mr Vamvakidis highlighted that the severity of the crisis in Greece was due to the lack of political will to implement necessary key reforms, which consequently forced the country into a brutal fiscal consolidation, plus the failure to use the crisis as an incentive to implement reforms that would boost the economy and prevent the crisis happening in the first place.


 

He outlined the absolute necessity to implement the reforms as soon as possible in order to transform Greece into a modern economy that will run with growth rates constantly above 2%.  Only with these growth rates will the economy accelerate, and the debt become sustainable.  If Greece is not capable of achieving these growth rates and instead remains at roughly 1%, then the debt sustainability problem is something that we will be faced with again very soon.

 When asked about the differences in the economic crisis between Greece and other European countries in the region, Mr Vamvakidis agreed that the crisis in Greece was far more severe, however he pointed out that Italy, Spain and Ireland were much more effective in implementing the necessary reforms and there was also a much better overall political agreement in order to create a “crisis-exit” plan.  

Investing in Greece - Accelerating the Economy