Main opposition New Democracy (ND) party continued to step up its criticism of the leftist SYRIZA government this week, charging on Monday that the Greek public debt’s sustainability parameters worsened under the latter’s watch from January 2015 onwards.
A top ND deputy spoke on the same day that a crucial Eurogroup meeting in Brussels will, for the first time, feature an agenda item referring to the issue of the Greek debt’s sustainability. The extraordinary meeting will focus exclusively on progress for a first review of the third Greek bailout.
Christos Staikouras cited an IMF report of June 26, 2015, which refers to a worsening debt sustainability analysis.
“By late summer 2014, with interest rates having declined further, it appeared that no further debt relief would have been needed under the November 2012 framework, if the program were to have been implemented as agreed. But significant changes in policies since then—not least, lower primary surpluses and a weak reform effort that will weigh on growth and privatization—are leading to substantial new financing needs,” the report reads, in part.
The former ND minister emphasized that what is now imperative is for negotiations to begin on a new restructuring of the Greek debt, with lenders agreeing to honor, as he said, long-term commitments towards an extension of the repayment period; an extended grace period; lower interest rates; and changing variable interest rates to fixed rates for loans allocated by the institutions after the first memorandum.
