IMF wants Greece to restructure debt – Der Spiegel

BERLIN, April 2 (Reuters) – The International Monetary Fund
(IMF) is privately pushing Greece to restructure its debt soon
in view of the unsustainable fiscal burdens it is carrying,
marking a change of course, German magazine Der Spiegel
reported.

Without citing any sources, it wrote on Saturday that high
ranking IMF officials were recommending this to European
governments due to Greece’s current debt pile that is roughly
one-and-a-half times its entire annual economic output.

Early in March, IMF European Director Antonio Borges told
reporters he was “confident that Greek debt is sustainable”,
adding that the Greeks had made “quite a bit of progress on
their banks” as well. [ID:nN0788225]

Since the IMF believes current measures no longer suffice,
it would like to see either the interest rates on the debt
lowered, the maturities extended or straightforward haircuts
taken on the debt.

Although it believes Greece should soon begin discussions
with creditors over a debt restructuring, it is still not
willing to call for the move openly out of fears this could add
even further pressure to Portugal and its sagging government
balance sheet, Der Spiegel said.

In May of last year, the European Union and the IMF agreed
to a 110 billion euro bailout to avoid default, a deal that was
was modified late last month to reduce interest rates charged
and extend the payback period on the rescue funds.

In turn, Greece promised to speed up structural reforms,
complete a 50 billion euro state assets sale plan and introduce
a strict fiscal framework to rein in its budget deficit and
debt.

(Reporting by Christiaan Hetzner; Editing by Ron Askew)

IMF wants Greece to restructure debt – Der Spiegel