The model of Cyprus might be the best solution for Greece in order to force the government’s implementation of the structural reforms it has already agreed to with the country’s creditors. This is what the German magazine Der Spiegel estimates, citing information from the Chancellery. “Transmission risk — triggered after a Greek exit from the Eurozone — is very small and definitely limited,” the German magazine underlines, adding that both the member states with a large debt and the Eurozone itself are in a much better position than in 2012. Both the (European Stability Mechanism) ESM, and European Central Bank’s (ECB) QE program have shielded the euro area and there are many to who believe that Greece’s exit from the economic and monetary Union will make the Eurozone more homogeneous and stable than it is today. German Chancellor Angel Merkel is now convinced that a ‘Graccident’ (a Greek exit from the Eurozone by accident), is no longer a risk. Her advisers are now examining the Cypriot crisis, which two years ago found itself close to the Eurozone exit. At that time, the ECB threatened to discontinue the emergency funding assistance to local banks because the country’s Parliament refused to accept the proposed measures and the banks had to impose control over deposits withdrawals and transfers. Finally, the Cypriot government was forced to accept the creditor’s proposed program and this is what Merkel and her advisers see as a guide for Greece too. According to the article, Greece might need a “warning shot” in order to implement the program.
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