Greece is unlikely to
win any write down on debt owed to the euro area and should instead focus on
possible relief in the form of longer repayment periods, said Olli Rehn, who
helped avert a Greek exit from the European single currency at the height of
the financial crisis.
Syriza, an opposition
alliance that’s atop polls 10 days before Greek general elections, has called
for a write down on some of the national debt of about 180 percent of gross
domestic product. The euro area, which has already eased repayment terms on
emergency loans to Greece, has committed to considering “further measures and
assistance” to ease Greece’s debt burden.
“It doesn’t mean that
there would have to be a classic haircut on capital,” Rehn, now a vice
president of the European Parliament, said in an interview yesterday in
Strasbourg, France. “Instead, I would expect that the euro-zone countries would
rather look at ways and means of improving debt sustainability by further
extending loan maturities.”
New Greek political
forces risk clashing with old European formulas for handling distressed
euro-area governments after the Jan. 25 ballot in Greece. The country remains
the weakest link in the euro area after triggering the region’s debt crisis in
2009 and receiving 240 billion euros ($283 billion) in international aid
pledges in return for budget cuts and market deregulation.
(Πηγή: bloomberg.com)
