14 Jul 2015
IMF warns Greece needs deeper debt relief
FXStreet (Córdoba) - A leaked International Monetary Fund report has shown that Greece needs more debt relief than the Eurozone was willing to consider.
“The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date - and what has been proposed by the ESM”, said the IMF.
Among remarks, IMF stated that Greece borrowing at anything below AAA rates would cause an unsustainable debt dynamic for decades. The Fund adds that Eurozone creditors would have to give Greece a 30-year grace period and a very dramatic maturity extension, or else alternatives is either annual transfers to Greek budget or deep upfront haircuts.
The eurozone leaders knew of the IMF’s debt analysis before agreeing the third bailout terms for Greece, an EU source told Reuters.
“The dramatic deterioration in debt sustainability points to the need for debt relief on a scale that would need to go well beyond what has been under consideration to date - and what has been proposed by the ESM”, said the IMF.
Among remarks, IMF stated that Greece borrowing at anything below AAA rates would cause an unsustainable debt dynamic for decades. The Fund adds that Eurozone creditors would have to give Greece a 30-year grace period and a very dramatic maturity extension, or else alternatives is either annual transfers to Greek budget or deep upfront haircuts.
The eurozone leaders knew of the IMF’s debt analysis before agreeing the third bailout terms for Greece, an EU source told Reuters.