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The already established political system is not able to cope with the necessary reforms in Greece. Therefore, it would be better for the coalition government of Lucas Papademos to remain in power until the policies agreed with the European Union during the Summit of 26 October 2011 are introduced. This is the opinion of Miranda Xafa, Ph.D, Senior Strategist at IJPartners, who presented the estimates for the development of the world economy next year. She referred to the data of the International Monetary Union report announced in September this year and stressed that expectations have changed mainly due to the European crisis deepening in mid-October. Initial estimates of the Fund were that the Eurozone would register weak growth of 1.1% in 2012, but now this seems too optimistic.

As for Greece, Xafa stressed that the government has so far failed to implement the necessary structural reforms that will reduce costs in the budget and make Europe and the markets believe that Mediterraneans are able to deal with their domestic problems.

Concerning the common solution to the debt crisis in Europe, Miranda Xafa states that printing money by the European Central Bank will not cause inflation in the Eurozone. She explains that the effect of increasing the money is obtained when central banks increase the total amount of funds transferred in both cash and bank reserves. The increased volume allows an increase in lending and stimulates consumption and thus influences price levels.

The former member of the International Monetary Union states that this process requires lending but now, there is a recession, which is extremely difficult and which mainly affects the budgets of banks, households and companies. Under these conditions, this process of inflation would not occur, she stated and even hinted in amazement how Germany fails to see the obvious in this relation and continues to oppose the printing of money by the European Central Bank. Xafa gave the example of the fiscal policies of the USA, Britain and Japan, all of which resort to printing new money from time to time, but no uncontrollable inflation is observed there. On the contrary, in Japan there is even deflation.

In the general atmosphere of deepening crisis, Xafa argues that Germany might relax its position on the issue of money printing if the countries from the periphery of the Eurozone are correct in implementing the reforms set before them. Another option is to consolidate fiscal policy in the area in a single institution, which will also help Germany to take more easily the decision of printing Euro or issuing Eurobonds. According to the financial expert, this would be the last option to which Germany will resort after the states with debt problems have met their obligations to restructure their economic models and produce primary budget surpluses.

"We need a lender of last resort. In advanced economies, these are central banks and in developing economies this is the International Monetary Fund," said Athanasios Vamvakidis, Head of European G10 Foreign Exchange Strategy, Bank America Merrill Lynch (BAML), UK. He said this type of "last resort" lender in the Eurozone has not been established yet because the International Monetary Fund has granted as much funds as possible, the European Central Bank does not want to bear all the responsibility, the European Financial Stability Facility does not have the necessary capital. Therefore, the lack of a specific solution to the debt crisis is a huge problem now.

Explaining why the reforms have failed so far, Miranda Xafa states that Greece’s problem with low competitiveness or the lack of any is not related to the level of wages in the private sector that started decreasing all down the line but mainly to the high administrative costs in the public sector. She explains that in Greece, 52 state enterprises operating at a loss for years continue to be kept alive. Until this changes, competitiveness will be always low even if wages in the private sector completely collapse. However, she does not deny that the pace of salaries' increase in Greece was two to three times higher than in Germany in the period to 2009, although it is not justified by corresponding increases in the country’s productivity.