Germany is urging Athens to adopt contingency plans that would foresee a voluntary, “market-friendly” debt restructuring should Greece fail to meet its ambitious fiscal targets, the Financial Times reported.
Citing people briefed about Berlin’s thinking, the newspaper wrote on Saturday that one plan involved swapping Greek debt at market prices for paper guaranteed by the eurozone, similar to “Brady Bonds” issued by South American countries in the late 1980s.
“The government has long since started preparing for a Greek restructuring,” the FT quoted one person briefed as saying.
“It’s not pushing Greece into this. It knows that none of these plans will work if the Greeks don’t want them.”
The chancellery declined to comment on the FT report, referring all media inquiries on the matter to the finance ministry.
German FinMin denies Greek debt restructuring plans
The German finance ministry on Saturday denied it was drawing up contingency plans for a Greek debt restructuring after the Financial Times reported.
“There have been media reports today regarding German plans for Greek sovereign debt restructuring. These plans have no basis in reality,” said Martin Kotthaus, spokesman for Finance Minister Wolfgang Schaeuble, in a written statement sent on Saturday.
(source: reuters)
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