Germany’s central bank (Bundesbank) directly entered the “Greek debt” fray this week, amid still unresolved differences between European creditors and the IMF over the issue, pointing out that Greece continues to exceed memorandum-mandated primary surplus budget targets.
In echoing the German government’s standing position that debt relief measures in the current phase are not necessary for thrice bailed out Greece, the Bundesbank said high fiscal targets – i.e. surpluses of 3.1 percent of GDP – are, in fact, an additional debt forgiveness measure.
A relevant report by German’s powerful central bank said Greece remains in an ESM program until August 2018, while evaluations of Athens’ fiscal performance must be judged based on the targets of the bailout program, and not just European fiscal regulations.
