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Greece's Creditors Disagree Over Ways to Ease Debt

euroworking-group-1000The possibility of creditors reaching an agreement on easing the Greek debt before the May 24 Eurogroup is removed, according to a source close to the Euro Working Group talks.
Several member states expressed serious doubts over the debt easing proposal of the European Stability Mechanism. Much more so for the generous debt relief the International Monetary Fund demands in order to participate financially in Greece’s bailout program.
According to the source in Brussels, the economists representing the 18 euro zone countries participating in the Euro Working Group had been asked by their respective finance ministers to move to a more concrete proposal for the Greek debt than the one presented in the previous Eurogroup.
At the beginning of the meeting, ESM presented its proposal, which was renewed and more concrete. Germany, Finland and the Netherlands expressed serious doubts about whether Greece needs such a relief, claiming that they don’t agree with the ESM analysis of the country’s debt sustainability. There was also great divergence between the ESM and IMF debt sustainability analyses.
Only France was, reluctantly, in favor of the ESM proposal. Even Portugal and Ireland — countries that went through bailout programs — were against the ESM proposal.
Many states asked for more EWG sessions to be held before the May 24 Eurogroup because the issue of Greek debt relief is very difficult.

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