Private creditors may be expected to accept “selective default” on Greek debt
Eurozone leaders meeting in Brussels Thursday have indicated that a partial default on Greek debt may be acceptable as part of a second bailout package. Private creditors may contribute to the next round of aid, which would put Greece in “selective default”—allowing it to delay paying back some of its creditors. But some economists fear that even a partial default on Greek debt could further destabilize the European economy, especially if its not accompanied by another sizable bailout package. Last year, the Mediterranean country received some $148 billion in rescue loans from the E.U. and the I.M.F.