Eurogroup grants the beginnings of long-term debt relief for Greece

This article was published by Al Jazeera International. 

Greece came away from Thursday’s Eurogroup meeting with a $9.5bn (€8.5bn) loan instalment and the beginnings of a commitment to longer-term debt relief – the Syriza government’s key demand since it came to power in 2015.

The six hour-long meeting of Eurozone finance ministers effectively brought the International Monetary Fund on board with Greece’s third bailout loan, currently held only by European institutions, because the IMF insisted on debt relief as a precondition.

“Nobody claims that this is the best solution,” said IMF chief Christine Lagarde, who attended the Eurogroup session. “That would have been a final approval on debt relief so that there would be clarity. This is second best.”

Banks to liquidate €11.5bn of property

Attention is focused on whether Greece will receive a rescheduling of its public debt at the June 15 Eurogroup. Less attention is lavished on private Greek debt. 

The Bank of Greece on Tuesday published its targets for the reduction of non-performing exposures (loans that haven’t been serviced for at least 90 days), which have reached a staggering €105.2bn, or 60 percent of GDP.[1]

IMF chief offers Eurozone time on Greek debt relief

Christine Lagarde

International Monetary Fund chief Christine Lagarde is offering to wait a little longer before Germany and other Eurozone countries come around to the IMF’s analysis on the Greek debt.

“If the creditors are not yet at that stage where they can agree on and respect our assumptions, if it takes them more time to get there, we can acknowledge that and give them a bit more time,” she told Handelsblatt on Tuesday.

Greece raises pressure on Eurogroup for deal

Greece ramped up pressure on its creditors this week to deliver a policy package that renders its debt sustainable.

“The Greek government feels it has done its part of what it promised,” finance minister Euclid Tsakalotos told journalists in Athens on Monday. “We feel that the ball is very much on the side of our creditors and the IMF [International Monetary Fund]. There are no excuses for not getting this overall deal that the Greek economy so desperately needs to access the markets and be able to leave the programme as planned in the summer of 2018.”