Greece is finnished

In Europe’s political wrangling over how to resolve the debt crisis that has enveloped the region, Germany is often cast as the villain — blocking attempts at greater fiscal integration, and demanding ever more stringent conditions be imposed on fellow member states calling out for aid. Of course, when you’re one of the biggest donors to the bailouts, it’s inevitable you’ll carry a bit of clout. But it seems the Germans aren’t the only ones.

As the analysts at STRATFOR write (in an analysis republished by Business Spectator, to which the title above is linked), Finland is causing trouble of a different kind. The Finns have been even more resolutely opposed to bailouts than the Germans. And in exchange for contributing to Greece’s aid, it has negotiated a collateral loan arrangement — whereby Greece will have to deposit a big wad of cash with the Finns, which they will forfeit if they fail to repay their loans. So, Finland is loaning Greece money, in exchange for which it will receive money from Greece. Does this not seem odd? As STRATFOR wryly observes, if the Greeks had money, they wouldn’t need the loan in the first place. While it is unlikely to be a full-collateral (dollar-for-dollar) arrangement — that would plainly be absurd — it nevertheless imposes a greater burden on other member states to cough up money so that Greece can afford to pay its bills (including to the Finns). Understandably, other members of the Eurozone are wondering why they’re not getting the same deal — Austria, Slovenia, Slovakia and the Netherlands are now seeking similar conditions for their loans to Athens. None of this will help bring an end to the economic crisis, of course. But it does leave the biggest contributor, Germany, with some very awkward questions of its own — as the region’s minnows try to cover their own contributions, how much of the bill is it willing to foot?