Eurogroup works to prevent "hot Greek summer" amid IMF, debt spats

Eurozone finance ministers were discussing Friday progress in the arduous bailout negotiations with Greece, as disagreements over debt relief and data overshadowed the process.

Athens has spent months negotiating with its creditors over reforms and cost-cutting measures that will allow aid to keep flowing from its third, 86-billion-euro (97-billion-dollar) bailout.

The negotiations are part of the creditors' first review of the rescue package. Its completion will pave the way for highly anticipated talks on debt relief for Athens.

The latest round of negotiations in Athens delivered "good news," Dutch Finance Minister Jeroen Dijsselbloem said before chairing talks by the eurozone ministers' Eurogroup panel in Amsterdam. EU Economy Commissioner Pierre Moscovici added that a deal was "within reach."

But the head of the International Monetary Fund (IMF) was less upbeat.

"Yes, there is some progress, there is no doubt. But we need more of it to arrive at something that adds up and which will put Greece back on its feet," IMF Managing Director Christine Lagarde said.

"We're not there yet," she added. "There is more work to be done."

The Washington-based fund has been at odds with Greece's other creditors, notably the European Commission, over the state of the country's public finances.

Lagarde welcomed new data released Thursday that showed Greece's public deficit and debt to be lower than expected in 2015, but also questioned whether it was accurate.

"We've seen in the past numbers being revised significantly," she noted. "So we will scrutinize those numbers very carefully."

Greek debt relief, meanwhile, is likely to challenge unity within the European ranks.

Dijsselbloem indicated that the issue could start to be discussed in Amsterdam, but other ministers ruled out quick action.

"That is currently not in the foreground," German Finance Minister Wolfgang Schaeuble said. "The topic [of debt relief] cannot distract people from doing what needs to be done."

"The first review needs to take place before we can even start talking about any kind of rejigging of debt," Finnish Finance Minister Alexander Stubb added.

But in the meantime, fears are mounting that delays may return Greece to the brink of bankruptcy.

"What we all want to do this year is to avoid a hot Greek summer," Stubb noted. "A head-on collision this summer, I don't think that's in the interest of anyone."

Last update: Fri, 24/06/2016 - 08:49
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