Moreover, Italian and Spanish authorities may resent the intrusion of external bodies such as the IMF and may be loathe to seek any assistance unless there is no other option. There are also issues surrounding the monitoring of such as program.
“There maybe a temptation by countries to issue shorter term debt (i.e. up to 3 years), thereby creating refinancing risks after 3 years.” the Team adds. Finally, there is the parlous state of the economies to contend with, and such a program will not directly benefit the ailing economies – notwithstanding the indirect benefits of mitigating against financial market disruptions.