Greece gets the humiliating deal. But the real problem is growth. The economy has shrinked by one-fourth in last five years. And that make debt-to-gdp ratio even more dangerous. The deal pretty much squeezes the space for Greece to grow. And if this was not enough greek assets worth 50 B Euro to a holding company which will either sell or generate cash from them, is like rubbing salt in the wound.
Analysts in Europe too have called the deal harsh and one that will do more harm to Greece than good. Commenting on the deal Marc Ostwald, strategist at ADM Investor Services International saidthat the “highlights of the deal are that there is no long-term future for the Eurozone and the desire on the part of Eurozone creditor nations to completely destroy the Greek economy — it can certainly be asserted that this is indeed a worse deal than the 1919 Treaty of Versailles”.
For the world markets, Greece will be a local issue and not hog the limelight, till the next time it is ready to default.