Finance minister says coronavirus has suspended planned bond issue

A rise in borrowing costs caused by the coronavirus has halted Greek plans to tap bond markets again this year, Finance Minister Christos Staikouras said on Friday.

Greece emerged from bailouts in 2018 after a decade-long debt crisis that locked it out of bond markets for years. It has since had several successful issues, including a 15-year bond in January.

“We had planned one more bond issue after January,” Staikouras told Greek Thema radio. “Obviously, we cannot tap markets at a prohibitive borrowing cost. We are not in a rush.”

Staikouras said that Greece had not used a 30 billion-euro cash buffer of unused bailout loans and money raised from markets. If needed, the government “would use all available means, at the right time, to support the economy”.

Greece’s economic recovery relies heavily on tourism, which has been hit hard by the spread of Covid-19.

Staikouras said the economy would shrink by about 3 percent this year. A month ago, the conservative government was estimating growth of 2.8 percent.

The government says its stands ready to inject up to 10 billion euros into measures to shield businesses, jobs and economic activity from any further impact from the virus. 

[Reuters]