By N. Bellos
Major differences between European institutions and the IMF over Greek debt relief are not expected to be overcome at the technocratic level, with only a political decision at the very highest echelons left for any breakthrough to emerge from a crucial May 24 Eurogroup meeting.
Sources in the Belgian capital said as much on Wednesday, in the wake of this week’s press leaks of IMF proposals, which reportedly call for part of the Greek debt be frozen until 2040 and with bonds’ maturity pushed back as far as 2080 – when the majority of today’s taxpayers won’t even be alive.
The IMF has repeatedly urged debt relief in order to ensure debt sustainability, something specifically cited in its charter and a standing demand by its non-European members. Conversely, European institutions and national governments, particularly Germany, want reforms and fiscal targets fulfilled first and at least through 2018.
Unless positions change by Tuesday’s Eurogroup meeting then the same sources said it was very doubtful that Athens would emerge with an advantageous debt deal that also entails the smallest possible cost for other EZ member-states.
The fact that Athens is completing the final stretch towards meeting demands in order to achieve a first review of the Greek program (third bailout) also doesn’t change the “debt calculus”, given that negotiations towards a compromise – and the precedent they could set – have now advanced to the highest possible level.
Germany’s position is termed as difficult in the current debate, given that Berlin wants to absolutely ensure the IMF’s participation in the Greek bailout, yet at the same time the German government is weary of trying to get Bundestag’s approval for yet another Greece-related relief measure.
