Dijsselbloem: IMF, eurozone can agree on Greek debt

Dijsselbloem said that while European governments opposed any nominal writedown of Greek debt, and while the IMF believed Greek debt was not sustainable as is, they will be able to find a compromise in the form of lower interest rates and longer repayment terms.

Dijsselbloem said the Eurogroup is convinced that Greece’s debt burden will be sustainable for years to come after the bailout, until 2030 at least.

“The IMF is gloomier about that than we are, their gloomiest scenario is gloomier than ours, but we have come to an agreement about the approach,” he said.

If Greece’s economy performs worse than expected and it has difficulty in repaying its debt “we will then look at the duration of loans. But that’s not even necessary now,” Dijsselbloem said.

Dijsselbloem, who is also the Netherlands’ finance minister, was speaking in a debate in the Dutch parliament over the approval of the bailout package agreed with Athens.

IMF Managing Director Christine Lagarde has expressed scepticism about the sustainability of Greek debt under the bailout package’s terms. The IMF’s board is to decide on whether to participate in the bailout only when it meets in October.

source: Reuters