Creditors must do right thing and give Greece debt relief: EU


Greece debt relief

On Thursday during an international conference organised by the Greek Economic Chamber, Declan Costello, the European Commission’s troika representative said it was time Greece’s creditors gave the country the much-needed debt relief.

Costello said Europeans need to meet their commitments regarding Greek debt relief and proceed with an agreement on a series of front-load measures to ease the country's public debt.

He underlined that the recent crisis in Italy sends out a message that when Greece comes out of the programme, it will be in a "fragile state".

"There is a negative impact from Italy on spreads, and what is happening does not help the government, the banks or the businesses," he said.

He also warned that the country should not change its policy and reverse the reforms because this would undermine confidence.

Costello noted that Greece has been in the programme for eight years and many things have been achieved in that time. The country has built up a cash buffer that reduces its exposure to the markets and is ready to 'take off', he said. He also emphasised that Greece's partners must honour their commitments concerning the country's debt and for Greece to have sustainable policies.

In  his speech he said that Greece will complete the programme and that the Eurogroup on June 21 will examine the conclusion of the fourth review, debt relief and the post-programme progress of the country. At the same time, he estimated that the radical structural reforms in the country will require 5-10 years to complete.

GCT Team

This article was researched and written by a GCT team member.