Eurozone, IMF are far from Greek deal: Source

LONDON - Agence France-Presse

French Finance Minister Moscovici (L) speaks with Luxembourg Prime Minister Jean-Claude Juncker. AFP photo

Eurozone finance ministers and the IMF are still far from a deal on releasing rescue funds to Greece because of disagreement over Greece’s debt pile, a source close to failed overnight talks told AFP yesterday, contradicting France.

“We are really not close to an agreement,” the source who declined to be named said after eurozone ministers and the IMF failed in talks in Brussels which went into the early hours of yesterday morning.
The talks were being held up by “hawks” in northern Europe, the source said.

The source told AFP that the talks, attended by the director general of the International Monetary Fund, Christine Lagarde, and the president of the European Central Bank, Mario Draghi, were stuck on the issue of how to ensure that Greek debt is sustainable in the medium term.

But French Finance Minister Pierre Moscovici said that the meeting had ended just a “whisker” away from a deal.

However he also said that the eurozone “would be under threat if we were not to get there” but insisted that “we are very close to an agreement.”

The IMF was insisting that measures be agreed to ensure that the ratio of Greek debt to output be reduced to 120 percent by 2020 from an expected figure of 190 percent, the first source said.

Currently, the IMF “is refusing to sign an agreement which it considers to be unrealistic,” the source said.

The eurozone finance ministers, meeting as the Eurogroup, are to meet again with the IMF and the ECB on Nov. 21.

The IMF is constrained by its statutes from lending to a country which cannot reasonably be expected to repay its debt in the medium-term.