Euro area to discuss with IMF how to ‘smoothen out’ Greek debt burden, says Dijsselbloem

Eurogroup president Jeroen Dijsselbloem says the eurozone will discuss with the International Monetary Fund ways to “smoothen out” Greece’s debt burden.

Speaking at the sidelines of an IMF meeting in Lima, Peru, Dijsselbloem emphasized the euro area’s position that it is Greece’s annual debt servicing costs, rather than the overall burden, that has to be taken into account when judging whether Greek debt is sustainable.

“The approach we will take is to look at whether Greece can service its own debt, can carry the debt burden on an annual basis,” he told CNBC.

“If you look at that, it flattened out very much. The interest rate has been reduced on different occasions. The maturities are now 32.5 years,” added the Dutch finance minister.
The IMF has yet to join the Greek program and insists that Athens needs substantial debt relief. However, Dijsselbloem seemed confident that the eurozone could reach a compromise with the Fund.

“The annual debt burden for Greece is very low. There are a couple of hikes we may have to deal with,” he said. “I think we have to agree with the IMF on how to smoothen it out if necessary even more.”