Klaus Regling: Greek debt is sustainable

Klaus Regling: Greek debt is sustainable

The course of the Greek debt and the peculiarities that make it sustainable were analyzed at the 7th Delphi Economic Forum, which takes place in Delphi on April 6-9 and is under the auspices of SA. of the President of the Republic, Mrs. Katerina Sakellaropoulou.

“Greek debt is sustainable. Its structure is better than other countries,” said Klaus Regling, head of the European Stability Mechanism (ESM). He explained that the average maturity of the Greek debt is 20 years, when the average in the European Union reaches 8-9 years, while interest rates are lower. Mr. Regling described the Greek debt as the insurance policy for the development of the coming years, but pointed out that the government should pursue a prudent fiscal policy, with the continuation of reforms.

During the discussion moderated by the journalist, Phoebus Karzis, the head of the European Stability Mechanism estimated that growth will be lower throughout Europe due to the war in Ukraine, but will not turn into a negative sign, because the economy received a big boost. from the previous year, while the increased savings of households can also support private consumption.

“The desire for reforms is not affected by the timing of the elections. There are always budgetary limits, the goal is to enter the investment stage in 2023,” said Alexis Patelis, head of the prime minister’s finance office. He argued that the debt-to-GDP ratio would decline this year and stressed that the government should manage the energy crisis, but without stopping interventions to modernize the state. He announced that the immediate legislative work includes the reform of primary health care, the clawback, the reform of OAED, the law on HRDH, the climate law and the simplification of RES licensing. “We will do the best we can to deal with the energy shock, after that of the pandemic, supporting the most vulnerable with targeted measures,” added Mr. Patelis.

For his part, George Chouliarakis, former Deputy Minister of Finance (2015-2019) noted that time was lost with legislation that did not help development and described as crucial the path we will choose to restore sustainability. “The quality of the Greek debt allows us to plan in the long run, interest rates are in favor of Greece, we should not proceed aggressively with growth,” he added.

Athanasios Petralias, Secretary General of Fiscal Policy, expressed his optimism for the course of the debt, saying that in 2021 the debt-to-GDP ratio is 193%, this year it will fall by 10%, while by 2026 it will fall to 150%. He estimated that everything will depend on the duration of the energy crisis, noting that the country will show a primary surplus close to 1%.

In her own position, the Special Secretary for Private Debt Management, Marialena Athanasopoulou, referred to the new solvency framework and the tools she provides to debtors to settle their debts. As he said, there is an interconnection of the database of all creditors, an algorithm provides viable solutions and 460 business restructurings have already been carried out.

Source: Capital