Greece to roll out "diaspora bond"

[ASusilovic]

Papaconstantinou said the government plans to try to sell debt to Greeks abroad, saying there were as many living overseas as in the country itself.

“A diaspora bond which will tap the market and the willingness of Greeks abroad to contribute to this effort is something we want to do,” he said. “We’ll be rolling something like this out sometime in 2011.”

http://noir.bloomberg.com/apps/news?pid=20601087&sid=a3brQp2ZBtYo&pos=7

Why selling it only to the diaspora ? I am sure many Greek "domestic" citizens will support their country, too, or ?

 

[MGJ]

Good tutorial: http://www.vanderbilt.edu/econ/conference/gped-conference-06/papers/s-ketkar.pdf

Suhas L. Ketkar writes

Since patriotism is the principal motivation for purchasing Diaspora bonds, they are likely to be in demand in fair as well as foul weather. Also, the Diaspora is expected to provide a "patriotic" discount in pricing these bonds. The patriotic discount, which is tantamount to charity, raises an interesting question of why would a country not seek just charitable contributions from their Diaspora and thereby escape debt-servicing burden associated with bonds. While countries do find seeking handouts degrading, the principal reason for their preference for bonds versus charity is that the former raises a lot more money than the latter. In other words, Diaspora bonds allow a country to leverage a small amount of charity into a large amount of resources for development.

 

[zdreg]

re: capitalizing diaspora incorrectly

A diaspora (in Greek, διασπορά â€“ "a scattering [of seeds]") is the movement or migration of a group of people, such as those sharing a national and/or ethnic identity, away from an established or ancestral homeland. When capitalized, the Diaspora refers to the exile of the Jewish people and Jews living outside ancient or modern day Israel.