Senior officials from the Finance Ministry
will head eastward in a bid to drum up funds that will help meet the country’s
borrowing needs in a plan that could see Asian investors buying up to 10
billion dollars of government debt.
Finance Minister Giorgos Papaconstantinou
detailed yesterday a diversified global borrowing plan to plug government
fiscal gaps, including hopes to raise large capital amounts from Chinese and
other Asian investors.
Papaconstantinou told Dow Jones Newswires
he will lead a delegation next month to the
US
and
Asia
to market Greek
debt valued at at least $1.5 billion to $2 billion denominated in euros,
dollars and possibly yen.
But Greek officials hope that the bond
tour, which will include stops in
Beijing
,
Shanghai
and
Hong Kong
, could bring in
five times that amount if Chinese investors are attracted to the deal.
“There is a lot of liquidity in
China
. There are big funds in
China
. This is why China is going to be part of the road
show,” Papaconstantinou said, adding that if Chinese investors are to get
involved the bond size has to be “significant... possibly $5 billion to $10
billion.”
A person familiar with the situation said
that
Greece
is trying to place as much as 25 billion euros with
Chinese investors.
The government this year must raise some
54 billion euros to cover its financing needs, including more than 20 billion
euros of maturing bonds that fall due in April and May.
Its first bond auction of the year, which
raised 8 billion euros on Monday, met with strong demand but the Greek
government paid a high premium to ensure its success.
“The era... of exceptionally low borrowing
costs is probably or likely coming to an end. Obviously in the case of
Greece
that comes to an end in a very dramatic manner,”
David Riley, head of sovereign ratings at Fitch, told Reuters.
Riley added that the
Hellenic
Republic
still needed to pursue aggressive plans to reduce its
budget deficit.
(
from
E-Kathimerini)