21/02/2012 World Business Report

the government and troops. $170 billion. The deal was done on

the second Greek bail out. More on World Business Report.

Welcome. This is World Business Report. The headlines: Ever 130

billion euros in a new deal as Ura Finance Ministers agree on the

terms of a new deal for Greece. Mixed trading in Asia as the euro

comes against the dollar and the yen. Asian stock markets are not

impressed. More than 20 countries meet in

Moscow to try and pressurise the European Union into abandoning its

carbon tax on airlines. After an exhausting and mammoth

meeting in Brussels, eurozone finance ministers have finally

reached agreement on a second bail- out package for Greece. The deal

means that the Greek government will receive another rescue fund

worth 130 billion euros to prevent its economy from defaulting on its

debts next month. There are strict conditions attached. These are the

key points: Ministers have discussed and agreed on a Greek

debt target of 121 % of gross domestic product by 2020. That is

slightly above the target set before. To help Athens reach about,

private bondholders agree to accept a bigger loss on their investments

of 53.5 % or more. This debt Exchange will help reduce Greece's

debt by around 100 billion euros. The European Central Bank will pass

up profit is made from buying Greek bonds, as well as other banks.

The euro is jumping after this news. Let's speak to the professor of

economics from the University of Athens. The immediate reaction to

the news the deal is done? Relief or concern about what this means

that the future? Depression at the sight of Europe remaining in deep

denial over both the state of the Greek economy and the state of the

eurozone. In terms of the detail, the private bondholders, they're

taking a fairly big hit. The ECB is taking a chunk also. This is all

about reducing debt, which is a short-term fix. What about the

long-term? Greece has now officially the faulted. But Europe

is calling it by a euphemism. They caught a second bail out. There are

two important factors. Firstly the rate at which it repays its debts

and the rate of growth. If they do not match up, you have a disaster.

Greece's numbers do nobers do no. The whole deal was unsustainable. -

- is unsustainable. These are all projections and forecasts. It is

assumed various things will happen at certain times but it is

difficult to predict these things. There will also be strict measures

in force. How will this go down? Whenever one makes predictions, one

will be charged -- judged by one's track record. According to troika,

Greece's problem should have been sold by now. We have to judge them

on the basis of previous predictions. Regarding the question

of the swap, we have a new privileged class of Greek creditors

who want to receive the new bonds that will be issued as part of this

swap. The rest will be subordinated. Thank you.

But look at the market numbers. The share market is not impressed by

this story. The euro did jump at the news. What is happening on the

market? If you look at the numbers today,

Asian stock investors are quite disappointed by this whole Greek

debt deal. They have already discounted the developments today.

Most of the region's remaining in negative territory. There is a lot

of scepticism about the implementation of these strict

austerity measures and whether Greece will need more money again

after this bail-out package. Analysts say it is not only crease

facing a debt issue but also Portugal, Spain and Italy. Will

they also go to the same path as crews? Will they need more money?

There are many questions about the ongoing debt crisis. In Australia,

commodity prices continue to rise. Gold and food prices continue to

head north. If most equities were unresponsive, the equity markets

were active with the euro jumping more than one in a US cent. The

Japanese currency remains at six- month lows against the greenback.

There was a relief rally in emerging Asian punt -- currencies

with Australian and music -- New Zealand are dollars getting a lift.

Thank you. There is a lot more analysis of all of that story on

our website. Now to other business stories. A

crowd the lines of more than 20 countries has been formed to try

and pressurise the EU into abandoning its carbon tax on

airlines. The countries are sending delegates to a meeting in Moscow

today to discuss the best way to retaliate against the tax. The US

charging airlines for all the carbon they met on flights in

European airspace and will start demanding payments later this year.

At the start of this year, the European unit began to charge

airlines for carbon emitted on all air flights using EU s base.

It is estimated that will cost the airline $300 million this year.

Non-EU airlines are being charged $75 million. The US and China argue

that the EU has no right to tax other countries. They're calling

themselves the Coalition of the unwilling. They are meeting to

discuss ways to get the EU to back down on its new aviation tax.

Options include suspending free- trade deals with Europe, putting

extra charges on its European airlines, or banning their own

airlines from participating in the EU scheme. Airlines have until

spring next year to pay their carbon taxes. If it is boycotted, a

dispute could escalate. If we see large-scale noncompliance among

foreign airlines, the EU would be required to do something. That

could be impounding Airlines, which could lead to tit-for-tat in power

and immense -- empowered mends. It could be very damaging for the

airlines as a whole. Name months of delicate diplomacy lie ahead.

will be difficult to extract payment from non- EU airlines if

they are determined not to pay. The trick will be to allow that to

happen while engaging in serious negotiations with these countries.

The government seems set on a co course over carbon tax.