Greece's finance minister on Thursday downplayed the implications of a "selective default" rating being slapped on the debt-ridden country after an expected second bailout, AP reported. Credit rating agencies have said they will consider the country to be in default of its debts if the EU gets private creditors to share the burden of another rescue package. Markets have been jittery about the potential consequences - not only on the financial system in Greece but in other European countries as well. Evangelos Venizelos told Parliament that a selective default rating would be manageable. He said Greece faced "no danger of bankruptcy" and that its banking system was secure. "The term 'selective default' should not be translated into Greek in a populist and irresponsible way. There is no danger of bankruptcy," Venizelos told parliament. He insisted such a rating would be only temporary. "Here's a comparison: The train of the Greek public debt must now shift tracks from the severe condition we are in ... to a track heading toward an improved condition ... This has a momentary duration, and must happen. It takes place without risk, with no real problem." Venizelos said Greece is in talks to lighten its debt burden by obtaining longer repayment periods, reducing interest rates on its loans and probably also through a mechanism to buy back government debt on the secondary market. He claimed Greek banks were safe because they rely on emergency cash from the European Central Bank, rather than having to raise funds on financial markets. Over the past weeks, investors have resigned themselves to the fact that Greece will have to default on its debts in some way or another. On Wednesday, Fitch slashed its rating on Greece by another three notches - further into junk status and just one grade above a default rating. Meanwhile, the country's debt burden continues to rise as a share of national income. Though it posted growth in the first quarter of the year, Greece's economy has spent most of the time since 2008 in recession and is forecast to shrink further in the coming quarters at least. On Wednesday, the International Monetary Fund warned that Greece's national debt would reach 172 percent of gross domestic product in 2012, above the fund's estimate of 159 percent made in March. Greece depends on loans from a ?110 billion ($155 billion) international rescue package from other eurozone countries and the IMF. -- SPA
