IMF chief says restruc­tur­ing should suf­fice for Greek debt

The Pak Banker - - COMPANIES/BOSS -

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 in 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 favour 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 cer- tain 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.

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. China de­val­ued its yuan cur­rency this month af­ter ex­ports tum­bled in July, spook­ing global mar­kets wor­ried that a main driver of growth was run­ning out of steam.

"The slow­down was pre­dictable, pre­dicted, un­avoid­able," La­garde was quoted as say­ing.

"We ex­pect that China will have a growth rate of 6.8 per­cent. It may be a lit­tle less." The IMF did not be­lieve growth would fall to 4 or 4.5 per­cent, as some fore­saw. Not­ing that a drop in com­mod­ity prices had hit many emerg­ing mar­kets, she said those economies were "at the cen­tre of our at­ten­tion."

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.