change ) surplus / defic surplus / deficit it ( % of gdp ) ( % of gdp ) general government debt ( % of gdp ) current account balance ( % of gdp ) 10 - year government npls amount bond yield & spread ( % of total loans ) vs 10 - year bund greece 2, 5 3, 9 0, 9 178, 0 0, 4 46, 6 % ( as of q3 2017 ) feb 2018 : 4, 11 % 336 bps ireland 1, 6 - 1, 8 - 6, 1 119, 4 2, 1 25, 7 % ( as of q4 2013 ) jun 2013 : 4, 13 % 240 bps portugal 0, 9 - 2, 3 - 7, 2 130, 6 - 0, 3 11, 6 % ( as of q2 2014 ) dec 2013 : 6, 04 % 410 bps cyprus 3, 0 3, 0 0, 5 107, 1 - 4, 9 48, 5 % ( as of q1 2016 ) nov 2015 : 4, 02 % 345 bps source : bank of greece. i intend to skip here the latest heated debate on cash buffers vs. a precautionary credit line, for 2 reasons. firstly, they are both short - term solutions, maximum one plus one year, but the real question remains what comes next after the first post mou - year. this is the question i propose to focus on, namely : what needs to be done in order for the country to achieve a permanent sustainable return to the capital markets, like the pre - 2008 status. it will be the sequel question to either cash buffer or precautionary credit line the country will inevitably have to face in a year or so. i want to open this debate from here today by making a number of proposals that will make such a return feasible in the foreseeable future. secondly, this economic debate has turned into a saga, it ’ s a politically controversial issue, as it is quite often the case in greece, some have called it ‘ sour grapes ’ – and i don ’ t want to go into that territory. the truth of the matter is that we have in our hands a eurogroup decision of 15 june 2017, which is an agreement between the government and our lenders in view of the ending of the current programme in august 2018 and i quote : “ europe commits to provide support for greece ’ s return to the market … ” and “ to further build up cash buffer

, the overall debt restructuring framework in the euro area, shaped by the experience of the european debt crisis, has evolved significantly to address more effectively sovereign debt challenges. in particular : - the esm, which acts as a permanent crisis resolution mechanism, has the legal mandate to restructure sovereign debt if necessary. - since 2013, all new euro area government bonds with maturities of more than one year must include collective action clauses ( cacs ). the use of cacs is a core component of the new debt restructuring framework, designed to ensure that restructuring can be carried out in an orderly manner, limiting market disruption. - the esm and the ec play a central role in conducting dsa before providing financial assistance. the framework is used to guide decisions on the necessity and the scale of any potential debt restructuring. - the experience of the greek debt restructuring highlighted the significance of the private sector involvement ( psi ) in sovereign debt crises. the greek case revealed the potential benefits and challenges of psi, where the involvement of private creditors helped reduce greece's debt burden, but the process also raised concerns about contagion risks. 4 / 8 bis - central bankers'speeches - the euro area crisis underscored the need for orderly and predictable debt restructurings. past experience has shaped principles to minimise financial market volatility. timely intervention is crucial, as early restructuring, if needed, is more likely to be successful before debt levels spiral out of control, than long, drawn - out restructurings. - the legal and institutional framework for debt restructuring has been enhanced to prevent moral hazard, ensuring that governments adhere to fiscal rules. the fiscal compact and the revised sgp impose stricter fiscal discipline to prevent excessive debt accumulation. the framework also ensures that sovereign debt restructuring is treated as a last resort, after all other policy measures ( such as fiscal adjustment, structural reforms, liquidity support ) have been exhausted. all in all, following our experience, the eurozone is much better equipped to manage sovereign debt crises in the future. however, the need for continued vigilance, early intervention and fiscal prudence remains essential to ensure that sovereign debt crises can be prevented and, should they arise, be resolved efficiently. 3. financial stability : a pillar of economic resilience the crisis also exposed vulnerabilities in europe's financial stability framework. the increase in the sovereign - bank nexus created a vicious circle of contagion, where failing banks weakened sovereigns and vice versa. the euro