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ESM: EU, IMF "In No Mood" for Greek Debt Haircut

reglingEuropean Stability Mechanism (ESM) Managing Director Klaus Regling stated to Greek newspaper “Realnews” that Greece’s international lenders are “not in the mood” to consider a debt haircut. “There is no political mood in the EU or the IMF for a Greek debt haircut,” he said.
Greece was expecting to receive further debt relief from other Eurozone members, as well as the International Monetary Fund (IMF) in late 2014, especially after the country managed to have a budgetary surplus.
However, according to Regling, lenders are “not even sure there is indeed a need for such small interventions.” He also added that the IMF would continue to help Greece with its financial problems until the first months of 2016. Meanwhile, the Troika would still need to supervise Greece’s economic adjustment under the bailout program.
“The Troika will continue to exist as is and conduct quarterly checks but with the IMF’s loan disbursements at stake, the fund will have the driver’s seat,” Regling said.
Even though Greece could decide to be freed of IMF’s audits and forgo its funding, Regling believes that such a move is unlikely because there is no way to know for sure if the country’s budget will be able to withstand it.

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