Greece is unlikely to be able to return to the markets next year, and if this is the case all options will be on the table to resolve the problem, the head of the European Financial Stability Facility Klaus Regling said Friday.
"It looks likely that the program designed for Greece a year ago has to be adjusted because this program assumed Greece would be able to return to the market," Regling said. "It seems unlikely that is possible in 2012."
No decisions have yet been taken as European policy makers await a report from the European Commission, the European Central Bank and the International Monetary Fund, which are all in Greece at the moment.
Decisions on action to take will only be taken once it is known for certain that Greece will be out of the markets next year, Regling said.
The best way forward would be further privatizations, although that may not have an impact soon enough, he said.
Further fiscal consolidation is an option, but it should be examined if that will be detrimental to growth, Regling said.
Still, he said nobody wants to create a "credit event," which could result from restructuring Greek debt.
"If something on the debt has to be done, nobody would want to do something that would lead to a credit event, but otherwise all the options will be on the table," he said.
Regling also said that while he remains optimistic for the euro area as a whole, Greece, Ireland and Portugal will face problems for a "number of years" and will have to continue with tough adjustments.
Dow Jones
