Leaders of the Group of 20 nations gather in Los Cabos, Mexico
Los Angeles Times
With the pro-bailout New Democracy party’s victory in Greece, leaders of the world’s biggest economies averted the worst of possible scenarios heading into their annual summit today, Monday.
The heads of the Group of 20 nations, who are gathering in a beachfront resort in Los Cabos, Mexico, were bracing for chaos to break out in financial markets and possibly their meetings if the Greek parliamentary election went the other way in favor of the radical anti-austerity group Syriza.
But the vote tally eased fears of an imminent Greek exit from the Eurozone. Asian markets, the first to react to Greece’s election results, opened sharply higher Monday. U.S. stock futures rose Sunday night.
“Certainly the outcome was among the most positive one could have expected,” said Domenico Lombardi, an expert on international monetary relations at the Brookings Institution. It essentially lifted the cloud of “an immediate meltdown and uncontrolled escalation of the Greek crisis.”
Even so, Lombardi and other analysts think the election results were likely to provide only temporary relief as they didn’t change the grim realities of Greece’s deep financial and economic problems. Nor did the Greek vote change the low expectations for the G-20 summit.
President Obama and other leaders, arriving here Sunday night, are hoping to avoid a repeat of last year’s G-20 summit in France when the meetings were overshadowed by crises in Greece and Italy, and leaders failed to secure funding from member countries to help contain the problem.