France, Germany at odds over Greek debt restructuring

PARIS, June 8 (Reuters) – France remains steadfast in its opposition to a restructuring of Greece’s debt under any terms, the government’s spokesman said on Wednesday, showing a divergence of opinion with Berlin.

German Finance Minister Wolfgang Schaeuble raised the prospect of a restructuring, saying in a letter to EU partners this week that private bondholders should bear some of the burden of a debt relief deal, preferably via a bond swap and a rescheduling.

“The French line has always been to refuse the restructuring of Greece’s debt and we are not deviating from that line, regardless of what terms are proposed,” government spokesman and Budget Minister Francois Baroin told reporters after a cabinet meeting.

While France has consistently rejected a restructuring of Greece’s 340 billion euro debt, Germany has been more open to the idea, which many economists now say is highly likely if Athens if to avert a default.

Schaeuble called in the letter for a “substantial contribution” from bondholders to Greek support efforts, and suggested extending the maturities of outstanding Greek debt by seven years.

His letter, dated June 6, was sent two weeks before a June 23-24 summit of EU leaders where a new bailout package for Greece is expected to be agreed.