The eurozone continues to be rocked by a debt crisis. The EU's peripheral countries are now the main sources of risk for the globalization of the sovereign debt crisis, and the difficulty of resolving the problem is largely due to the lack of integration of Europe.

In Portugal, the snap parliamentary elections have resulted in a change of power – the Social Democrats will form a new government in coalition with the People’s Party. The Socialist government resigned in March because the opposition blocked a budget austerity plan – a plan that was conditioned on Portugal receiving aid from the IMF, EU and ECB. The new government will inevitably have to adopt its own austerity plan, and perhaps the voter’s trust in the right-wing parties will be enough to accept it and begin implementing it.

The main headache remains Greece, which has been unable to reduce its debt burden and decisively reduce its budget deficit, despite the IMF and the EU helping it for a year. Mass demonstrations against cuts in social spending are held in Athens every week, and the yield on two-year bonds is already 15% (almost the default level).

Standard practices in the fight against the debt crisis include tightening the budget policy, inflation, default or debt restructuring. Inflation, like devaluation, which is also useful in the case of a large debt and a negative capital account, is closed for Greece - the EU countries do not have their own monetary policy. Reducing budget expenditures and raising taxes do not produce an effect due to the huge debt and the decline in economic activity. Default or restructuring are not prescribed in the rules of the European Union, they are the most frightening for European authorities and investors, but the likelihood of this outcome is high. Greece could agree with investors on restructuring in the case of a low budget deficit. But since it is high, the European Union will negotiate with them on a voluntary-compulsory basis. According to The Wall Street Journal, the next plan to save Greece, developed by EU financiers, will consist of a deferment of payments to private bondholders. If the plan is adopted, Greece will save 30 billion euros over three years and will not cancel out additional financial assistance.

Some analysts consider such a delay itself a default, and it may be assessed as such by rating agencies (Standard & Poor's promised). However, if investors take the delay calmly, we can expect more delays in the future.

However, the problem is not only in Greece’s financial indicators. Its creditors are banks from other EU countries, and a Greek default would require some form of assistance from their state budgets to these banks. The debt crisis is not limited to Greece, but also to other countries – a Greek default could sow panic in the bond markets. This applies primarily to other PIIGS members – Portugal, Italy, Spain and Ireland. Japan has major problems with its government debt – but its bondholders are mainly local banks. Debt debate has also intensified in the US, but there it is more of a political nature; rates on US bonds are still low and indicate their reliability. However, as in the case of the financial crisis, the possibility of a chain reaction cannot be ruled out – panic in the European market could spread to others.

As has been noted many times, the complexity of the situation with Greece (and other PIIGS) is largely due to the unfinished integration of Europe. A single monetary policy in the absence of a single finance ministry and each country's own tax policy means that neither the country itself can apply all possible methods to combat the crisis, nor can the EU fully manage the process of financial rehabilitation of any country. It is likely that in the near future the EU will have a single finance ministry. In the meantime, EU member states create the main risk of a global sovereign debt crisis.

Two steps away from default