Dijsselbloem to MEPs: Greece will need debt relief

Eurogroup chairman  Jeroen Dijsselbloem briefed MEPs in the European Parliament on Thursday that bailout-dependent Greece will need debt relief, echoing the standing IMF line, while expressing confidence that an agreement between the Greek side and institutional creditors will be hatched out by next month.

May 22 is the latest “unofficial deadline” for concluding the second review of the Greek program, which would free up bailout loans ahead of several repayments of previous loans extended to the country, which are due in July.

European creditors, led by Germany, have up until now been reluctant to discuss details regarding medium-term debt relief for the country. The latter is judged as crucial by the beleaguered Tsipras government for its political survival, and as a necessity by the IMF to ensure that the Greek debt is sustainable.

Moreover, he said ongoing negotiations in Athens between creditors’’ top auditors and the leftist-rightist government focus on reforms aimed to boost growth, not to perpetuate austerity in the still recession-plagued country.

"The (European) parliament has my personal strong commitment that we will achieve that deal for Greece in May. It needs to be done in May," he said.

"Yes, we will discuss debt and debt relief will be needed to find that solution, that is my opinion and I believe that is shared in the Eurogroup," he added.

On his part, EU Commission Pierre Moscovici also cited the need for a rapid conclusion of the second review, merely echoing repeated such comments over the past two months.

Speaking at the same session, the former French finance minister admitted that uncertainty over the review has repercussions on the Greek economy, merely noting that positive trends in 2016 slowed.