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Should Greece Learn Lessons From Russia’s Debt Crisis?

As European leaders scramble to contain the euro zone debt crisis and make preparations for an orderly default for Greece, on e fund manager argues that Russia’s debt crisis in 1998 could hold an important lesson for the southern European nation.

Russia’s domestic debt crisis in 1998 was “one of the best things ever to happen” to the country, Jochen Wermuth, CIO and Founding Partner at Wermuth Asset Management told CNBC on Thursday.

While some analysts have launched arguments in favor of a Greek exit from the euro, others have voiced concern that such a move would lead to a collapse of the single currency.

Russia devalued the rouble when oil prices fell sharply in 1998, triggering a debt crisis.

“The currency devalued six times. The country grew ten percent in the next ten years. It was a fantastic thing to devalue the currency and default in retrospect even though at the time we thought it was nuts,” Wermuth said. “For the Greeks that might not be so bad.”

They would have to leave the euro, he said, but he believed the only solution to the crisis was for Greece to do “something radical.”

"I’ve had some discussions with Greeks and they seem to think for now the solution would be to have a German finance minister...controlling their expenses," he said.

According to Wermuth, the ultimate solution to the euro zone debt crisis is a positive one, with Klaus Regling, the head of Europe’s rescue fund known as the European Financial Stability Facility (EFSF) acting as the euro zone’s finance minister.

“Probably we will have issuing of euro bonds, common government bonds, the Germans will pay the bill,” he said.

Contact Europe: Economy

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