ISSN 2330-717X

Greece Debt Deal ‘By End Of This Week’: Papademos


(EurActiv) — Prime Minister Lucas Papademos said negotiations with Greece’s private creditor banks would be concluded “by the end of this week”, raising expectations that Athens was close to ending a four-month negotiation over a debt restructuring plan.

Speaking to journalists after the EU summit yesterday (30 January), Papademos said the “time schedule is too tight, but we are totally committed to reaching an agreement”.

Private-sector involvement, or PSI, has been a sticking point in the negotiations over a €130 billion bailout plan for Greece, agreed in principle in October. As part of the plan, Germany insisted that private creditor banks shoulder part of the burden by writing off up to 50% of Greece’s debt.

“The reforms are there, but the measures needed to implement the reforms are still on the table,” Papademos said.

“We expect to reach an agreement on PSI by the end of this week.”

After the summit ended late Monday, Papademos pulled out separately for talks with senior officials from the European Central Bank (ECB) and the EU on restructuring Greece’s debt.

The talks involved Eurogroup President Jean-Claude Juncker, European Commission President José Manuel Barroso and European Council President Herman Van Rompuy. Mario Draghi, the ECB president, was originally expected to attend the meeting but was replaced by Jörg Asmussen, an ECB executive board member.

“There was no negotiation on Greece tonight, but we had a bilateral exchange of information,” Papademos told journalists after the meeting.

A summit statement by eurozone leaders took note of “progress made in the negotiations with the private sector” on Greece’s debt restructuring. “We urge the Greek authorities and all parties involved to finalise negotiations on the new programme in the coming days.”

The Greek prime minister did not speculate over whether more money would be needed to top up Greece’s second bailout plan, worth €130 billion. Details of the October deal still need to be negotiated.

“It’s too early now to say whether we will need some extra public funding. Our goal is to avert such an alternative and to implement properly the PSI agreement.”

Last week, the European Commission acknowledged for the first time that up to €15 billion was missing in the bailout plan, bringing its total headline figure to around €145 billion.

The aid package needs to be finalised by mid-February, giving Greece time to meet a looming €14.5-billion bond repayment in March.

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