We will have a mirror site at http://nunezreport.wordpress.com in case we are censored, Please save the link

Tuesday, August 30, 2011

Why Finland Could Re-Ignite Crisis Over Greek Bailout


Finland has proposed that Greek state assets be transferred to a Luxembourg-based holding company and held as security for new loans to Athens, according to an internal document obtained by Reuters.

The proposal, drafted in June, remains a central plank of Finnish demands for collateral in return for providing more aid to Greece.

Senior euro zone officials held another conference call on Monday to try to resolve the collateral issue.

If Finland does not get its way, it may pull out of the Greek bailout, unleashing renewed trouble in financial markets.

Although small at around 1.4 billion euros, Finland's share of the new support for Greece is important because its triple-A credit rating adds weight to the 109 billion euro rescue agreed on July 21, the second bailout package Athens has received.

Demands from Helsinki for collateral have sparked requests from countries including Austria, the Netherlands, Slovenia and Slovakia for similar treatment, and threaten to spoil the euro zone's attempt to save Athens from default.

In the document, Finnish officials set out how the Greek government and its privatization agency would authorize the transfer of assets to a holding company based in Luxembourg that would be used as security for states providing assistance. To see the document, click here.

The privatization agency would own all the shares in the asset holding company, although the shares would be held in custody by a third party.





Since the holding company would be based in Luxembourg, it would operate under Luxembourg law.Such a move would prove controversial in Greece, where the government has strongly rejected suggestions of offering land or company shares as collateral for future loans. It would in effect mean Greece, which plans to raise 50 billion euros from privatization by 2015, losing sovereignty over its assets.

"The Privatisation Agency is managing the AHC (Asset Holding Company) and can use AHC in a flexible way as one vehicle to securitise, manage, develop and privatise assets," reads the Finnish plan, dated June 23 and obtained exclusively by Reuters.


CNBC

hostgator coupon 2011

No comments:

Post a Comment