Stratfor: Troika and government will compromise

According to Stratfor, both lenders and Greece worry about the possibility of early elections

Stratfor, a geopolitical intelligence firm that provides strategic analysis and forecasting, published a report on Greek debt and the negotiations that will be made between the government and its lenders.

In the coming weeks and months, the Greek government will negotiate debt relief measures with the European Union and the International Monetary Fund and according to Stratfor, both lenders and Greece worry about the possibility of early elections and the possible destabilization of the country.

American analysts forecast that given the fragmented political landscape of the country the result of possible early elections will be uncertain, if the government fails to elect president of Hellenic Republic in February.

Therefore, “Athens will resist EU pressure to apply significant austerity measures: The Greek leadership needs to avoid social unrest and delay elections as long as possible”, says Stratfor’s report.

According to Stratfor “Both Athens and Brussels have an interest in delaying new Greek elections for as long as possible, making a compromise on Greece’s debt highly likely. Even if the European Union and the International Monetary Fund ask Greece for additional reforms, Greece’s lenders will be flexible enough to reach a deal with Athens. Ultimately, neither side wants new tensions at a time when Greece is finally seeing some degree of political and economic stability, making compromise on Greek debt all the more likely”

Also, the report mentions the “private debt of Greece, which is believed to have reached 160 billion euros, 88% of the country’s GDP, which consists mainly of nonperforming loans in Greek banks but also includes unpaid taxes and unpaid social security contributions”.