World Economy

Greece Debt Talks Still Fraught

Greece Debt Talks Still FraughtGreece Debt Talks Still Fraught

Critical talks on easing Greece’s massive debt burden remain fraught with conflict, despite assurances from the International Monetary Fund on Thursday that the sides are closer to an agreement.

A deal to secure debt relief for Athens from the eurozone is the missing piece to unlocking loans the country needs to make debt payments and begin to recover from the years-long crisis, AFP reported.

But transcripts of part of the recent discussions between the IMF, the European Central Bank and eurozone finance ministers published by Greek financial website Euro2day on Thursday show many disputes remain and few of the participants are satisfied, least of all Greece Finance Minister Euclid Tsakalotos.

He slammed one of the proposals floated in the discussions the “worst of all worlds” for Greece. “I don’t think anyone here can say that is a good deal for us, who have negotiated in good faith.”

This seems to contradict comments from an IMF official Thursday, who said the differences are narrowing even though the fund needs more specifics on a debt relief plan before it can agree to release more financing.

“Everyone is optimistic that agreement can be reached and hopefully can be reached at the next Eurogroup meeting” in mid-June, IMF spokesman Gerry Rice told reporters.

In contrast, the IMF’s main negotiator, Poul Thomsen, said he was “very far away from being able to tell our board that we are close to a strategy we can agree to” on debt relief, according to the transcripts.

Greece’s debt mountain stands at a towering 180% of annual output, the legacy of a crisis that brought panic to the markets and nearly forced the country out of the euro.

The sides early this month announced an agreement on a package of reform measures, including on the tax and pension system, which has since been approved by the Greek parliament.

The deal was aimed at unlocking the next tranche of aid from Europe from the third, €86 billion ($94 billion) aid deal Greece and its creditors secured in July 2015.

Greece needs the funds to repay €7 billion in maturing debt in July.


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