BAILOUT DRAMA

Greek President Calls on Schäuble to Back Debt Relief

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How about a little solidarity, Herr Schäuble? Picture source: Reuters

Greek President Prokopis Pavlopoulos is not happy with the emerging compromise between the euro-zone finance ministers and the International Monetary Fund. In fact, he is down-right irritated.

IMF chief Christine Lagarde, in an Handelsblatt interview last week, indicated that the fund would agree to participate in a third bailout program, but would refrain from kicking in funds until an agreement is reached on debt relief for Greece.

This compromise would clear the way for the euro zone to disburse the next tranche of bailout money and allow Greece to avoid default ahead of a looming €7.3-billion ($8.1-billion) payment due in July. The euro zone and the IMF are expected to back this solution at a meeting on Thursday.

German Finance Minister Wolfgang Schäuble has insisted on IMF participation in the bailout, but the fund and Mr. Schäuble disagree on the need for debt relief. Berlin is reluctant to support debt relief, a controversial issue in Germany, ahead of national elections in September.

Mr. Pavlopoulos, in interview with Handelsblatt, called on Mr. Schäuble to uphold the euro zone’s end of the bargain and support debt relief now that Greece has passed a raft of austerity measures.

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