ESM Chief: No Greek Debt Cut



ESM Chief Klaus Regling says Greece will have to pay back its loans
ESM Chief Klaus Regling says Greece will have to pay back its loans

While Greek Prime Minister Antonis Samaras said Greece’s battered economy will begin to recover this year – and with even a possible return to the markets – the government’s hope for reducing its debt by not paying back in full the $325 billion it owes international lenders has been dashed again.

The head of the Eurozone’s bailout fund, Klaus Regling has ruled out the possibility of a restructuring of Greek debt, media outlet EU Observer reported.

Speaking to Germany’s Spiegel magazine, Regling – who heads the European Stability Mechanism (ESM), Greece’s largest creditor with 133 billion euros in 30-year loans already disbursed at an interest rate of 1.5 percent – is quoted as saying, “There will be no debt restructuring.”

“The interest on these loans was deferred for the next 10 years. All this equals a debt restructuring, from an economic point of view,” Regling is quoted as saying. German Chancellor Angela Merkel, whose country is putting up the lion’s share of the loans, and who has insisted on harsh austerity in return, also has nixed any hope of debt relief for Greece.

The Greek government said it will have a primary surplus this year, which would be a trigger to asking for debt relief but a squabble between the lenders is making that look more unlikely.

The International Monetary Fund, which, along with the European Union and European Central Bank makes up the Troika of the country’s lenders, said it won’t accept losses either but said the ECB should.

Regling said he doubts Greece’ creditors would be open to changes in Greece’s agreement, as the IMF, which is putting in 27.2 billion euros to Greece’s two bailouts – is not allowed to lower its interest rate.

“There may be some little room for maneuver in the bilateral loans from the first bailout package. But that is up to Eurozone member states to decide – they are the creditors there,” Regling said.


13 COMMENTS

  1. I’ve said it once, I’ll say it again -Germany wants their money. It’s a loan. It’s a bailout. It’s not a gift. Not free handout. Greece is run by a Parliament of corrupt politicians who lie and steal. Don’t believe me? Look at Tzohatsopoulos, Pangalos, Papantoniou, Liapis and tons more. These guys are transparent got caught. There are tons more who are not transparent like Venizelos (biggest crook and lier) G.Papandreou (being protected by the USA) and tons more.
    Greece is run by a mafia cartel in government.
    I predict elections in 2014 and SYRIZA will WIN IT by a big margin.
    The businessmen, white collar and blue collar and the well off (upper middle class and wealthy) those who are corrupt and stole from the state and evaded taxes from the state as well as the ones who didn’t steal- clean money all WANT THE COALITION GOV’T to continue. Samaras and company.
    The rest (majority poor and frustrated) will vote on emotion Tsipras
    Greece EXIT! EURO COLLAPSE- GAME OVER!

  2. Greece simply run the end of the road.They exhausted all their money sources they were getting money from under the pretext of” Loans”.Now Greece had been exposed as county of crooks and liars that have no intention to ever repay those “loans”.I

  3. The Venizelos-Samaras Junta is finished.
    Golden Dawn will soon be handed the reins of power by the Hellenic electorate.
    A great future, a Golden future is coming for Greece, and for all Europe.
    As for Greece’s enemies, e.g. Skopia. Well lets just say it won’t be pleasant being a Skopian once Golden Dawn controls Greece’s military.

  4. One more reason to keep the debt collar and leash around the neck of Greece. To wage war they would need money.

  5. LOL. FYROM are fried, soon the Slavs will go back to their motherland, Bulgaria… FYROM will belong to your Albanian friends. Start building Albanians statues and more mosques you stupid Fyromonkeys… LOL.

  6. Hey Imposter, learn to spell and write English before you post this rubbish.

    If you cannot write English on a this website, then maybe write Greek, the language of Μακεδόνες.

    If that’s too hard, maybe you should troll thru some of your native Bulgarian publications and place your comments there, in your native dialect.

  7. Also, humankind originated from Africa. This is a known fact. So I am not sure what your point is.

    Oops I forgot, that proven fact doesn’t fit in with your misled, misguided, unproven propaganda.

  8. Berlin – Greece’s hopes for another debt deal aimed at helping it exit the bailout programme at the end of 2014 are not realistic, Klaus Regling, the head of eurozone’s bailout fund (ESM), told Spiegel magazine.

    “There will be no debt restructuring,” Regling said.

    The ESM is Greece’s largest creditor, with €133 billion in 30-year loans already disbursed at an interest rate of 1.5 percent.

    “The interest on these loans was deferred for the next ten years. All this equals a debt restructuring, from an economic point of view,” Regling said.

    There is also very little room for change with other creditors. The International Monetary Fund – contributing €27.2 billion to Greece’s bailout – is not allowed to lower its interest rate.

    “There may be some little room for manoeuvre in the bilateral loans from the first bailout package. But that is up to eurozone member states to decide, they are the creditors there,” Regling said.

    Greek foreign minister Evangelos Venizelos, who also served as finance minister when the bailout terms were negotiated, has warned that his coalition government may be toppled and replaced by anti-bailout parties if Greece does not get a debt deal this year.

    “It is not about another debt restructuring. It’s about making the debt burden sustainable (…) for instance by prolonging the repayment deadlines and reducing the interest rates,” Venizelos told Frankfurter Allgemeine Sonntagszeitung on Sunday.

    He warned that if Greece would be forced out of the eurozone, this would become a “threat to the German taxpayer” and therefore it was “in the common European interest for Greece to successfully exit the bailout programme.”

    Greek Prime Minister Antonis Samaras in his New Years’ speech promised that his country would exit the bailout in 2014.

    In December, he sought a debt deal with fellow EU leaders, but his efforts proved unsuccessful.

    Meanwhile, the troika of lenders – IMF, European Commission and European Central Bank – has delayed a report allowing for the next bailout tranche to be paid out because of disagreements over the 2014 budget.

  9. Does that mean that I have to repay my AMEX? I have gotten away for it so long that the shop keepers have started to question why the silver is showing through the black card which was coloured in black texta. I had to play the part. I’m Greek after all !!

  10. Tedi is right. It would take days to outline how dysfunctional, non-competitive, corrupt (including fraud with their stats to enter EU and Euro), culturally flawed, inept…etc. etc. However, worse of all the propaganda of blaming others continues. Just like Iran and Venezuela blame everything on the US to control the masses. I am Canadian so I am not biased to the US. Without Germany Greeks would be getting sacks of rice from the UN.