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Why does Greece matter?

Duration:
18 minutes
First broadcast:
Thursday 20 May 2010

Greeks are upset by Greek government cuts but why exactly should the rest of us take notice?
The main problem is that banks outside Greece bought Greek bonds and that puts them in hock, according to Brian Caplen, the Editor of the The Banker.
It's also not just the straightforward matter that banks outside Greece are owed money by Greece, but also there's the question of trust. Once banks don't quite know the liabilities of other banks, they're loath to lend and that's what happened two years ago when the Global Financial Crisis first erupted. There's a danger of that happening again, as Professor Laura Tyson of the University of California at Berkeley and an advisor to President Obama explained to Steve Evans.
Steve also asked the EBRD's Chief Economist, Erik Berglof, if the Greek rumpus was resonating in the old communist countries all around Greece.
And why Greek woe raises an eye-brow in Africa. Hear the views from our regular commentator Wycliffe Muga.

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