What Greece means for Portugal
There’s still no deal on Greek debt, but investors are nervous, quite reasonably, that any loss inflicted on private-sector holders of Greek debt will soon be replicated in the case of Portugal. Via Bloomberg: The Greek debt swap negotiations that may produce relief for Athens are fueling concerns in Lisbon where an agreement would make ...
There's still no deal on Greek debt, but investors are nervous, quite reasonably, that any loss inflicted on private-sector holders of Greek debt will soon be replicated in the case of Portugal. Via Bloomberg:
There’s still no deal on Greek debt, but investors are nervous, quite reasonably, that any loss inflicted on private-sector holders of Greek debt will soon be replicated in the case of Portugal. Via Bloomberg:
The Greek debt swap negotiations that may produce relief for Athens are fueling concerns in Lisbon where an agreement would make it more likely Portuguese investors would be next in line to accept a loss.
European leaders have said a Greek accord where investors take a 50 percent writedown in the face value of their bonds is unique and won’t be applied to other nations struggling to tame rising debts. Holders of Portuguese securities are skeptical, with the yield on the nation’s 10-year bonds rising today to a euro-era record of 15.78 percent.
“Portugal’s debt and lack of growth is very similar to Greece,” Yannick Naud, who manages $150 million at Glendevon King Asset Management, said in a Jan. 23 interview in London. “Its bonds are falling because it’s very obvious to everyone that if there’s a haircut for Greece, there might well be a haircut for Portugal too.”
David Bosco is a professor at Indiana University’s Hamilton Lugar School of Global and International Studies. He is the author of The Poseidon Project: The Struggle to Govern the World’s Oceans. Twitter: @multilateralist
More from Foreign Policy

Saudi-Iranian Détente Is a Wake-Up Call for America
The peace plan is a big deal—and it’s no accident that China brokered it.

The U.S.-Israel Relationship No Longer Makes Sense
If Israel and its supporters want the country to continue receiving U.S. largesse, they will need to come up with a new narrative.

Putin Is Trapped in the Sunk-Cost Fallacy of War
Moscow is grasping for meaning in a meaningless invasion.

How China’s Saudi-Iran Deal Can Serve U.S. Interests
And why there’s less to Beijing’s diplomatic breakthrough than meets the eye.