The floating of a new five-year bond issue by Greece is a step in the right direction, but a small one, Bank of Greece Governor Yannis Stournaras said on Tuesday.
The bonds of the Greek state have not acquired investment status yet, therefore their returns remain high and variable, Stournaras explained at an event of the Open University of Cyprus. They are easily affected by international market disruptions and by concerns of the investment community about how committed economic policy is to implementing scheduled reforms.
Therefore, he said, the existence of reserves totalling nearly 25 billion euros is useful, but cannot replace the need to access the markets on viable terms.
The central banker also warned that the greatest risk in the state budget was contained in the decisions of the Council of State, which found two laws of 2012 on the insurance system unconstitutional, calling for the reinstatement of bonuses for civil servants.