Greece and its creditors were to continue negotiations on a debt swap yesterday after late-night talks on Friday edged them closer to a vital deal.
Athens is anxious to strike a deal before tomorrow’s meeting of eurozone finance ministers, just in time to set in motion the paperwork and approvals necessary for Greece to receive a new injection of aid to avoid a messy bankruptcy in March.
PRIVATE SECTOR
“The elements of an unprecedented voluntary PSI [private sector investment] are coming into place,” the Institute of International Finance said in a statement after Friday’s three-hour evening negotiation session, referring to the bond swap scheme.
“Now is the time to act decisively and seize the opportunity to finalize this historic deal and contribute to the economic stability of Greece, the euro area and the world economy,” it said.
The statement seemed to be addressing Greece’s official lenders, the EU and the IMF, who have driven a hard bargain behind the scenes of the negotiations, sources in Athens said.
“We will not know anything for sure before Monday,” a banking source close to the talks said. “The eurozone ministers will examine the proposal and say whether we have a deal. If they say we don’t, we’re back to the negotiating table.”
HARD HIT
Private bondholders will likely take a hit of 65 to 70 percent on their holdings, with Greece’s new bonds featuring 30-year maturity and a progressive coupon, or interest rate, averaging out at 4 percent, another banking official close to the talks said.
A 15 percent cash sweetener will be made up of short-term bonds from Europe’s temporary bailout fund, the European Financial Stability Facility (EFSF), two sources said.
“It will be near cash-equivalent short-term EFSF bonds,” one of the sources said.
Haggling over the coupon had held up the long-running talks as Greece raced to wrap up an agreement, raising the prospect of a messy default when Athens faces 14.5 billion euros (US$18.5 billion) of bond repayments in March.
Another source close to the talks said the two sides had been hoping to bag a preliminary deal on Friday, with technical discussions with lawyers continuing over the weekend and into next week.
“There is still work to be done. The two sides are doing what they can, but the paymasters must give their blessing,” the source said.
The source said the European Central Bank’s part in the deal was also discussed.
Greece needs to have a deal in the bag before funds are doled out from a 130 billion euro rescue plan that the country’s official lenders drew up in October.
OUT OF TIME
“The deal must be completed. There is no more time left,” said a Greek government official who requested anonymity.
The swap is aimed at cutting 100 billion euros off Greece’s debt load of more than 350 billion euros. The second bailout — drawn up on the condition that Greece pushes through painful cuts and structural reforms — is expected to reduce Greece’s debt to a more manageable 120 percent of GDP in 2020 from about 160 percent now.
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
DOMESTIC SUPPLY: The probe comes as Donald Trump has called for the repeal of the US$52.7 billion CHIPS and Science Act, which the US Congress passed in 2022 The Office of the US Trade Representative is to hold a hearing tomorrow into older Chinese-made “legacy” semiconductors that could heap more US tariffs on chips from China that power everyday goods from cars to washing machines to telecoms equipment. The probe, which began during former US president Joe Biden’s tenure in December last year, aims to protect US and other semiconductor producers from China’s massive state-driven buildup of domestic chip supply. A 50 percent US tariff on Chinese semiconductors began on Jan. 1. Legacy chips use older manufacturing processes introduced more than a decade ago and are often far simpler than
STILL HOPEFUL: Delayed payment of NT$5.35 billion from an Indian server client sent its earnings plunging last year, but the firm expects a gradual pickup ahead Asustek Computer Inc (華碩), the world’s No. 5 PC vendor, yesterday reported an 87 percent slump in net profit for last year, dragged by a massive overdue payment from an Indian cloud service provider. The Indian customer has delayed payment totaling NT$5.35 billion (US$162.7 million), Asustek chief financial officer Nick Wu (吳長榮) told an online earnings conference. Asustek shipped servers to India between April and June last year. The customer told Asustek that it is launching multiple fundraising projects and expected to repay the debt in the short term, Wu said. The Indian customer accounted for less than 10 percent to Asustek’s
Gasoline and diesel prices this week are to decrease NT$0.5 and NT$1 per liter respectively as international crude prices continued to fall last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC and Formosa stations are to decrease to NT$29.2, NT$30.7 and NT$32.7 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while premium diesel is to cost NT$27.9 per liter at CPC stations and NT$27.7 at Formosa pumps, the companies said in separate statements. Global crude oil prices dropped last week after the eight OPEC+ members said they would
RSS