IMF's Lagarde says restructuring should suffice for Greek debt

Sat Aug 29, 2015 7:11am EDT
 
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ZURICH (Reuters) - A form of debt restructuring rather than outright forgiveness should enable Greece to handle its "unviable" debt burden, the head of the International Monetary Fund was quoted as telling a Swiss newspaper.

The IMF has yet to make clear if it will participate in the third 86-billion-euro ($96 billion) international bailout that Greece signed up to in early August, having argued in favor of a partial writedown of a debt burden it considers unsustainable in its current form.

Greece's euro zone creditors, notably Germany, have ruled out a writedown but are willing to consider other forms of restructuring such as a lengthening maturities.

Asked about those differences, IMF Managing Director Christine Lagarde told Saturday's edition of Le Temps: "The debate on cancelling the debt has never been open I don't think it is necessary to open it if things go well...

"We are talking about extending maturities, reducing rates, (making) exemptions for a certain period of time. We are not speaking about cancelling debt."

The interview made no mention of whether the IMF will take part in the new bailout, which Lagarde has previously said it will make a decision on by October.

NO CHINESE HARD LANDING?

Turning to China, Lagarde said she expected the country's economic growth rate to remain close to previous estimates even if some sort of slowdown was inevitable after its rapid expansion.   Continued...

 
International Monetary Fund (IMF) Managing Director Christine Lagarde talks to Greek Finance Minister Euclid Tsakalotos (R) during a euro zone finance ministers meeting in Brussels, Belgium, July 12, 2015.  REUTERS/Francois Lenoir