German Finance Minister Schä uble: Greece Needs Economic Overhauls
20 October 2016 - 8:10PM
Dow Jones News
BERLIN—German Finance Minister Wolfgang Schä uble said Thursday
what debt-ridden Greece needs is economic overhauls, and not debt
relief, because any easing of the debt burden would reduce the
urgently needed willingness to reform the country.
His comments, which signal Germany's persisting hard line
against Greece, come after Mr. Schä uble visited earlier this month
Washington, where talks with senior financial officials and the
International Monetary Fund included Greece's debt
sustainability.
"They don't understand that Greece's problem isn't its debt
level but Greece's problem is its lack in competitiveness and its
inability to build up [functioning] administration," he said at a
book launch event.
"Everybody pretends as if some kind of debt relief would make
anything at all better in Greece. The only thing that would change
is trampling even more all over any willingness to tackle a couple
of reforms."
Earlier this month, the IMF signaled it isn't likely to soon
rejoin Europe in more financing for debt-worn Greece, if at all.
The fund argues that eurozone governments need to restructure their
loans to Athens to ensure Greece's solvency.
Since July 2015, Greece has relied on financing from the rest of
the eurozone, whereas the IMF's participation as a lender has been
on ice because the fund believes Greece's debt isn't sustainable
and requires large-scale relief.
Germany has pushed hard for the IMF to rejoin the present third
Greek bailout, with the government calling participation "of vital
importance," but the IMF has insisted on additional debt
relief.
Write to Andrea Thomas at andrea.thomas@wsj.com
(END) Dow Jones Newswires
October 20, 2016 14:55 ET (18:55 GMT)
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